SECOND DIVISION

[G.R. No. 127240. March 27, 2000]

ONG CHIA, petitioner, vs. REPUBLIC OF THE PHILIPPINES and THE

COURT OF APPEALS, respondents. marie

DECISION

MENDOZA, J.:

This is a petition for review of the decision of the Court of Appeals reversing
[1]

the decision of the Regional Trial Court, Branch 24, Koronadal, South
Cotabato admitting petitioner Ong Chia to Philippines citizenship.
[2]

The facts are as follows:

Petitioner was born on January 1, 1923 in Amoy, China. In 1932, as a nine-

year old boy, he arrived at the port of Manila on board the vessel "Angking."
Since then, he has stayed in the Philippines where he found employment and
eventually started his own business, married a Filipina, with whom he had four
children. On July 4, 1989, at the age of 66, he filed a verified petition to be
admitted as a Filipino citizen under C.A. No. 473, otherwise known as the
Revised Naturalization Law, as amended. Petitioner, after stating his
qualifications as required in 2, and lack of the disqualifications enumerated in
3 of the law, stated -

17. That he has heretofore made (a) petition for citizenship under
the provisions of Letter of Instruction No.270 with the Special
Committee on Naturalization, Office of the Solicitor General,
Manila, docketed as SCN Case No.031776, but the same was not
acted upon owing to the fact that the said Special Committee on
Naturalization was not reconstituted after the February, 1986
revolution such that processing of petitions for naturalization by
administrative process was suspended;

During the hearings, petitioner testified as to his qualifications and presented

three witnesses to corroborate his testimony. So impressed was Prosecutor
Isaac Alvero V. Moran with the testimony of petitioner that, upon being asked
by the court whether the State intended to present any witness against him,
he remarked: novero
 Actually, Your Honor, with the testimony of the petitioner himself
which is rather surprising, in the sense that he seems to be well-
versed with the major portion of the history of the Philippines,
so, on our part, we are convinced, Your Honor Please, that
petitioner really deserves to be admitted as a citizen of the
Philippines. And for this reason, we do not wish to present any
evidence to counteract or refute the testimony of the witnesses for
the petitioner, as well as the petitioner himself. [3]

Accordingly, on August 25, 1999, the trial court granted the petition and
admitted petitioner to Philippine citizenship. The State, however, through the
Office of the Solicitor General, appealed contending that petitioner: (1) failed
to state all the names by which he is or had been known; (2) failed to state all
his former places of residence in violation of C.A. No. 473, 7; (3) failed to
conduct himself in a proper and irreproachable manner during his entire stay
in the Philippines, in violation of 2; (4) has no known lucrative trade or
occupation and his previous incomes have been insufficient or misdeclared,
also in contravention of 2; and (5) failed to support his petition with the
appropriate documentary evidence. [4]

Annexed to the State's appellant's brief was a copy of a 1977 petition for
naturalization filed by petitioner with the Special Committee on Naturalization
in SCN Case No. 031767, in which petitioner stated that in addition to his
[5]

name of "Ong Chia," he had likewise been known since childhood as "Loreto
Chia Ong." As petitioner, however, failed to state this other name in his 1989
petition for naturalization, it was contended that his petition must fail. The
[6]

state also annexed income tax returns allegedly filed by petitioner from 1973
[7]

to 1977 to show that his net income could hardly support himself and his
family. To prove that petitioner failed to conduct himself in a proper and
irreproachable manner during his stay in the Philippines, the State contended
that, although petitioner claimed that he and Ramona Villaruel had been
married twice, once before a judge in 1953, and then again in church in 1977,
petitioner actually lived with his wife without the benefit of marriage from 1953
until they were married in 1977. It was alleged that petitioner failed to present
his 1953 marriage contract, if there be any. The State also annexed a copy of
petitioner's 1977 marriage contract and a Joint-Affidavit executed by
[8] [9]

petitioner and his wife. These documents show that when petitioner married
Ramona Villaruel on February 23, 1977, no marriage license had been
required in accordance with Art.76 of the Civil Code because petitioner and
Ramona Villaruel had been living together as husband and wife since 1953
without the benefit of marriage. This, according to the State, belies his claim
that when he started living with his wife in 1953, they had already been
married. ella

The State also argued that, as shown by petitioner's Immigrant Certificate of

Residence, petitioner resided at "J.M. Basa Street, Iloilo," but he did not
[10]

include said address in his petition.

On November 15, 1996, the Court of Appeals rendered its decision which, as
already noted, reversed the trial court and denied petitioner's application for
naturalization. It ruled that due to the importance of naturalization cases, the
State is not precluded from raising questions not presented in the lower court
and brought up for the first time on appeal. The appellate court held:
[11]

As correctly observed by the Office of the Solicitor General,

petitioner Ong Chia failed to state in this present petition for
naturalization his other name, "LORETO CHIA ONG," which name
appeared in his previous application under Letter of Instruction
No.270. Names and pseudonyms must be stated in the petition
for naturalization and failure to include the same militates against
a decision in his favor...This is a mandatory requirement to allow
those persons who know (petitioner) by those other names to
come forward and inform the authorities of any legal objection
which might adversely affect his application for citizenship.

Furthermore, Ong Chia failed to disclose in his petition for

naturalization that he formerly resided in "J.M. Basa St., Iloilo" and
"Alimodian, Iloilo." Section 7 of the Revised Naturalization Law
requires the applicant to state in his petition "his present and
former places of residence." This requirement is mandatory and
failure of the petitioner to comply with it is fatal to the petition. As
explained by the Court, the reason for the provision is to give the
public, as well as the investigating agencies of the government,
upon the publication of the petition, an opportunity to be informed
thereof and voice their objections against the petitioner. By failing
to comply with this provision, the petitioner is depriving the public
and said agencies of such opportunity, thus defeating the purpose
of the law

Ong Chia had not also conducted himself in a proper and

irreproachable manner when he lived-in with his wife for several
years, and sired four children out of wedlock. It has been the
consistent ruling that the "applicant's 8-year cohabitation with his
 wife without the benefit of clergy and begetting by her three
children out of wedlock is a conduct far from being proper and
irreproachable as required by the Revised Naturalization Law",
and therefore disqualifies him from becoming a citizen of the
Philippines by naturalizationnigel

Lastly, petitioner Ong Chia's alleged annual income in 1961 of

P5,000.00, exclusive of bonuses, commissions and allowances, is
not lucrative income. His failure to file an income tax return
"because he is not liable for income tax yet" confirms that his
income is low. . ."It is not only that the person having the
employment gets enough for his ordinary necessities in life. It
must be shown that the employment gives one an income such
that there is an appreciable margin of his income over expenses
as to be able to provide for an adequate support in the event of
unemployment, sickness, or disability to work and thus avoid
one's becoming the object of charity or public charge." ...Now that
they are in their old age, petitioner Ong Chia and his wife are
living on the allowance given to them by their children. The
monthly pension given by the elder children of the applicant
cannot be added to his income to make it lucrative because like
bonuses, commissions and allowances, said pensions are
contingent, speculative and precarious

Hence, this petition based on the following assignment of errors:

I. THE COURT OF APPEALS GRAVELY ABUSED ITS

DISCRETION IN RULING THAT IN NATURALIZATION CASES,
THE APPELLATE COURT CAN DENY AN APPLCATION FOR
PHILIPPINE CITIZENSHIP ON THE BASIS OF DOCUMENTS
NOT PRESENTED BEFORE THE TRIAL COURT AND NOT
FORMING PART OF THE RECORDS OF THE CASE.

II. THE FINDING OF THE COURT OF APPEALS THAT THE

PETITIONER HAS BEEN KNOWN BY SOME OTHER NAME
NOT STATED IN HIS PETITION IS NOT SUPPORTED BY THE
EVIDENCE ON RECORD.

III. CONTRARY TO THE FINDING OF THE COURT OF

APPEALS, THE PETITIONER STATED IN HIS PETITION AND
ITS ANNEXES HIS PRESENT AND FORMER PLACES OF
RESIDENCE.
 IV. THE FINDING OF THE COURT OF APPEALS THAT THE
PETITIONER FAILED TO CONDUCT HIMSELF IN A PROPER
AND IRREPROACHABLE MANNER IS NOT SUPPORTED BY
THE EVIDENCE ON RECORD. brando

Petitioner's principal contention is that the appellate court erred in considering

the documents which had merely been annexed by the State to its appellant's
brief and, on the basis of which, justified the reversal of the trial court's
decision. Not having been presented and formally offered as evidence, they
are mere "scrap(s) of paper devoid of any evidentiary value," so it was
[12]

argued, because under Rule 132, 34 of the Revised Rules on Evidence, the
court shall consider no evidence which has not been formally offered.

The contention has no merit. Petitioner failed to note Rule 143 of the Rules
[13]

of Court which provides that -

These rules shall not apply to land registration, cadastral and

election cases, naturalization and insolvency proceedings, and
other cases not herein provided for, except by analogy or in a
suppletory character and whenever practicable and convenient.
(Emphasis added)

Prescinding from the above, the rule on formal offer of evidence (Rule 132,
34) now being invoked by petitioner is clearly not applicable to the present
case involving a petition for naturalization. The only instance when said rules
may be applied by analogy or suppletorily in such cases is when it is
"practicable and convenient." That is not the case here, since reliance upon
the documents presented by the State for the first time on appeal, in fact,
appears to be the more practical and convenient course of action considering
that decision in naturalization proceedings are not covered by the rule on res
judicata. Consequently, a final favorable judgment does not preclude the
[14]

State from later on moving for a revocation of the grant of naturalization on the
basis of the same documents.

Petitioner claims that as a result of the failure of the State to present and
formally offer its documentary evidence before the trial court, he was denied
the right to object against their authenticity, effectively depriving him of his
fundamental right to procedural due process. We are not persuaded. Indeed,
[15]

the reason for the rule prohibiting the admission of evidence which has not
been formally offered is to afford the opposite party the chance to object to
their admissibility. Petitioner cannot claim that he was deprived of the right to
[16]

object to the authenticity of the documents submitted to the appellate court by

the State. He could have included his objections, as he, in fact, did, in the brief
he filed with the Court of Appeals, thus: nigella

The authenticity of the alleged petition for naturalization (SCN

Case No. 031767) which was supposedly filed by Ong Chia under
LOI 270 has not been established. In fact, the case number of the
alleged petition for naturalization is 031767 while the case number
of the petition actually filed by the appellee is 031776. Thus, said
document is totally unreliable and should not be considered by the
Honorable Court in resolving the instant appeal. [17]

Indeed, the objection is flimsy as the alleged discrepancy is trivial, and, at

most, can be accounted for as a typographical error on the part of petitioner
himself. That "SCN Case No. 031767," a copy of which was annexed to the
petition, is the correct case number is confirmed by the Evaluation Sheet of [18]

the Special Committee on Naturalization which was also docketed as "SCN

Case No. 031767." Other than this, petitioner offered no evidence to disprove
the authenticity of the documents presented by the State.

Furthermore, the Court notes that these documents - namely, the petition in
SCN Case No. 031767, petitioner's marriage contract, the joint affidavit
executed by him and his wife, and petitioner's income tax returns - are all
public documents. As such, they have been executed under oath. They are
thus reliable. Since petitioner failed to make satisfactory showing of any flaw
or irregularity that may cast doubt on the authenticity of these documents, it is
our conclusion that the appellate court did not err in relying upon them.

One last point. The above discussion would have been enough to dispose of
this case, but to settle all the issues raised, we shall briefly discuss the effect
of petitioner's failure to include the address "J.M. Basa St., Iloilo" in his
petition, in accordance with 7, C.A. No. 473. This address appears on
petitioner's Immigrant Certificate of Residence, a document which forms part
of the records as Annex A of his 1989 petition for naturalization. Petitioner
admits that he failed to mention said address in his petition, but argues that
since the Immigrant Certificate of Residence containing it had been fully
published, with the petition and the other annexes, such publication
[19]

constitutes substantial compliance with 7. This is allegedly because the

[20]

publication effectively satisfied the objective sought to be achieved by such

requirement, i.e., to give investigating agencies of the government the
opportunity to check on the background of the applicant and prevent
suppression of information regarding any possible misbehavior on his part in
any community where he may have lived at one time or another. It is settled,
[21]
however, that naturalization laws should be rigidly enforced and strictly
construed in favor of the government and against the applicant. As noted by
[22]

the State, C.A. No. 473, 7 clearly provides that the applicant for naturalization
shall set forth in the petition his present and former places of residence. This
[23]

provision and the rule of strict application of the law in naturalization cases
defeat petitioner's argument of "substantial compliance" with the requirement
under the Revised Naturalization Law. On this ground alone, the instant
petition ought to be denied. marinella

WHEREFORE, the decision of the Court of Appeals is AFFIRMED and the

instant petition is hereby DENIED.

SO ORDERED.
 SECOND DIVISION

[G.R. No. 153660. June 10, 2003]

PRUDENCIO BANTOLINO, NESTOR ROMERO, NILO ESPINA, EDDIE

LADICA, ARMAN QUELING, ROLANDO NIETO, RICARDO
BARTOLOME, ELUVER GARCIA, EDUARDO GARCIA and
NELSON MANALASTAS, petitioners, vs. COCA-COLA
BOTTLERS PHILS., INC., respondent.

DECISION
BELLOSILLO, J.:

This is a Petition for Review on Certiorari under Rule 45 of the Rules of

Court assailing the Decision of the Court of Appeals dated 21 December
[1]

2001 which affirmed with modification the decision of the National Labor
Relations Commission promulgated 30 March 2001. [2]

On 15 February 1995 sixty-two (62) employees of respondent Coca-Cola

Bottlers, Inc., and its officers, Lipercon Services, Inc., Peoples Specialist
Services, Inc., and Interim Services, Inc., filed a complaint against
respondents for unfair labor practice through illegal dismissal, violation of their
security of tenure and the perpetuation of the Cabo System. They thus prayed
for reinstatement with full back wages, and the declaration of their regular
employment status.
For failure to prosecute as they failed to either attend the scheduled
mandatory conferences or submit their respective affidavits, the claims of fifty-
two (52) complainant-employees were dismissed. Thereafter, Labor Arbiter
Jose De Vera conducted clarificatory hearings to elicit information from the ten
(10) remaining complainants (petitioners herein) relative to their alleged
employment with respondent firm.
In substance, the complainants averred that in the performance of their
duties as route helpers, bottle segregators, and others, they were employees
of respondent Coca-Cola Bottlers, Inc. They further maintained that when
respondent company replaced them and prevented them from entering the
company premises, they were deemed to have been illegally dismissed.
 In lieu of a position paper, respondent company filed a motion to dismiss
complaint for lack of jurisdiction and cause of action, there being no employer-
employee relationship between complainants and Coca-Cola Bottlers, Inc.,
and that respondents Lipercon Services, Peoples Specialist Services and
Interim Services being bona fide independent contractors, were the real
employers of the complainants. As regards the corporate officers, respondent
[3]

insisted that they could not be faulted and be held liable for damages as they
only acted in their official capacities while performing their respective duties.
On 29 May 1998 Labor Arbiter Jose De Vera rendered a decision ordering
respondent company to reinstate complainants to their former positions with
all the rights, privileges and benefits due regular employees, and to pay their
full back wages which, with the exception of Prudencio Bantolino whose back
wages must be computed upon proof of his dismissal as of 31 May 1998,
already amounted to an aggregate of P1,810,244.00. [4]

In finding for the complainants, the Labor Arbiter ruled that in contrast with
the negative declarations of respondent companys witnesses who, as district
sales supervisors of respondent company denied knowing the complainants
personally, the testimonies of the complainants were more credible as they
sufficiently supplied every detail of their employment, specifically identifying
who their salesmen/drivers were, their places of assignment, aside from their
dates of engagement and dismissal.
On appeal, the NLRC sustained the finding of the Labor Arbiter that there
was indeed an employer-employee relationship between the complainants
and respondent company when it affirmed in toto the latters decision.
In a resolution dated 17 July 2001 the NLRC subsequently denied for lack
of merit respondents motion for consideration.
Respondent Coca-Cola Bottlers appealed to the Court of Appeals which,
although affirming the finding of the NLRC that an employer-employee
relationship existed between the contending parties, nonetheless agreed with
respondent that the affidavits of some of the complainants, namely, Prudencio
Bantolino, Nestor Romero, Nilo Espina, Ricardo Bartolome, Eluver Garcia,
Eduardo Garcia and Nelson Manalastas, should not have been given
probative value for their failure to affirm the contents thereof and to undergo
cross-examination. As a consequence, the appellate court dismissed their
complaints for lack of sufficient evidence. In the same Decision however,
complainants Eddie Ladica, Arman Queling and Rolando Nieto were declared
regular employees since they were the only ones subjected to cross-
examination. Thus -
[5]
x x x (T)he labor arbiter conducted clarificatory hearings to ferret out the truth
between the opposing claims of the parties thereto. He did not submit the case based
on position papers and their accompanying documentary evidence as a full-blown trial
was imperative to establish the parties claims. As their allegations were poles apart, it
was necessary to give them ample opportunity to rebut each others statements through
cross-examination. In fact, private respondents Ladica, Quelling and Nieto were
subjected to rigid cross-examination by petitioners counsel. However, the testimonies
of private respondents Romero, Espina, and Bantolino were not subjected to cross-
examination, as should have been the case, and no explanation was offered by them or
by the labor arbiter as to why this was dispensed with. Since they were represented by
counsel, the latter should have taken steps so as not to squander their testimonies. But
nothing was done by their counsel to that effect.[6]

Petitioners now pray for relief from the adverse Decision of the Court of
Appeals; that, instead, the favorable judgment of the NLRC be reinstated.
In essence, petitioners argue that the Court of Appeals should not have
given weight to respondents claim of failure to cross-examine them. They
insist that, unlike regular courts, labor cases are decided based merely on the
parties position papers and affidavits in support of their allegations and
subsequent pleadings that may be filed thereto. As such, according to
petitioners, the Rules of Court should not be strictly applied in this case
specifically by putting them on the witness stand to be cross-examined
because the NLRC has its own rules of procedure which were applied by the
Labor Arbiter in coming up with a decision in their favor.
In its disavowal of liability, respondent commented that since the other
alleged affiants were not presented in court to affirm their statements, much
less to be cross-examined, their affidavits should, as the Court of Appeals
rightly held, be stricken off the records for being self-serving, hearsay and
inadmissible in evidence. With respect to Nestor Romero, respondent points
out that he should not have been impleaded in the instant petition since he
already voluntarily executed a Compromise Agreement, Waiver and
Quitclaim in consideration of P450,000.00. Finally, respondent argues that the
instant petition should be dismissed in view of the failure of petitioners to sign
[7]

the petition as well as the verification and certification of non-forum shopping,

in clear violation of the principle laid down in Loquias v. Office of the
Ombudsman. [8]

The crux of the controversy revolves around the propriety of giving

evidentiary value to the affidavits despite the failure of the affiants to affirm
their contents and undergo the test of cross-examination.
 The petition is impressed with merit. The issue confronting the Court is not
without precedent in jurisprudence. The oft-cited case of Rabago v.
NLRC squarely grapples a similar challenge involving the propriety of the use
[9]

of affidavits without the presentation of affiants for cross-examination. In that

case, we held that the argument that the affidavit is hearsay because the
affiants were not presented for cross-examination is not persuasive because
the rules of evidence are not strictly observed in proceedings before
administrative bodies like the NLRC where decisions may be reached on the
basis of position papers only.
In Rase v. NLRC, this Court likewise sidelined a similar challenge when it
[10]

ruled that it was not necessary for the affiants to appear and testify and be
cross-examined by counsel for the adverse party. To require otherwise would
be to negate the rationale and purpose of the summary nature of the
proceedings mandated by the Rules and to make mandatory the application of
the technical rules of evidence.
Southern Cotabato Dev. and Construction Co. v. NLRC succinctly states
[11]

that under Art. 221 of the Labor Code, the rules of evidence prevailing in
courts of law do not control proceedings before the Labor Arbiter and the
NLRC. Further, it notes that the Labor Arbiter and the NLRC are authorized to
adopt reasonable means to ascertain the facts in each case speedily and
objectively and without regard to technicalities of law and procedure, all in the
interest of due process. We find no compelling reason to deviate therefrom.
To reiterate, administrative bodies like the NLRC are not bound by the
technical niceties of law and procedure and the rules obtaining in courts of
law. Indeed, the Revised Rules of Court and prevailing jurisprudence may be
given only stringent application, i.e., by analogy or in a suppletory character
and effect. The submission by respondent, citing People v. Sorrel, that an
[12]

affidavit not testified to in a trial, is mere hearsay evidence and has no real
evidentiary value, cannot find relevance in the present case considering that a
criminal prosecution requires a quantum of evidence different from that of an
administrative proceeding. Under the Rules of the Commission, the Labor
Arbiter is given the discretion to determine the necessity of a formal trial or
hearing. Hence, trial-type hearings are not even required as the cases may be
decided based on verified position papers, with supporting documents and
their affidavits.
As to whether petitioner Nestor Romero should be properly impleaded in
the instant case, we only need to follow the doctrinal guidance set by Periquet
v. NLRC which outlines the parameters for valid compromise agreements,
[13]

waivers and quitclaims -

Not all waivers and quitclaims are invalid as against public policy. If the agreement
was voluntarily entered into and represents a reasonable settlement, it is binding on
the parties and may not later be disowned simply because of a change of mind. It is
only where there is clear proof that the waiver was wangled from an unsuspecting or
gullible person, or the terms of settlement are unconscionable on its face, that the law
will step in to annul the questionable transaction. But where it is shown that the
person making the waiver did so voluntarily, with full understanding of what he was
doing, and the consideration for the quitclaim is credible and reasonable, the
transaction must be recognized as a valid and binding undertaking.

In closely examining the subject agreements, we find that on their face

the Compromise Agreement and Release, Waiver and Quitclaim are devoid
[14] [15]

of any palpable inequity as the terms of settlement therein are fair and just.
Neither can we glean from the records any attempt by the parties to renege on
their contractual agreements, or to disavow or disown their due execution.
Consequently, the same must be recognized as valid and binding transactions
and, accordingly, the instant case should be dismissed and finally terminated
insofar as concerns petitioner Nestor Romero.
We cannot likewise accommodate respondents contention that the failure
of all the petitioners to sign the petition as well as the Verification and
Certification of Non-Forum Shopping in contravention of Sec. 5, Rule 7, of the
Rules of Court will cause the dismissal of the present appeal. While
the Loquias case requires the strict observance of the Rules, it however
provides an escape hatch for the transgressor to avoid the harsh
consequences of non-observance. Thus -

x x x x We find that substantial compliance will not suffice in a matter involving strict
observance of the rules. The attestation contained in the certification on non-forum
shopping requires personal knowledge by the party who executed the
same. Petitioners must show reasonable cause for failure to personally sign the
certification. Utter disregard of the rules cannot justly be rationalized by harking on
the policy of liberal construction (underscoring supplied).

In their Ex Parte Motion to Litigate as Pauper Litigants, petitioners made a

request for a fifteen (15)-day extension, i.e., from 24 April 2002 to 8 May
2002, within which to file their petition for review in view of the absence of a
counsel to represent them. The records also reveal that it was only on 10
[16]

July 2002 that Atty. Arnold Cacho, through the UST Legal Aid Clinic, made his
formal entry of appearance as counsel for herein petitioners. Clearly, at the
time the instant petition was filed on 7 May 2002 petitioners were not yet
represented by counsel. Surely, petitioners who are non-lawyers could not be
faulted for the procedural lapse since they could not be expected to be
conversant with the nuances of the law, much less knowledgeable with the
esoteric technicalities of procedure. For this reason alone, the procedural
infirmity in the filing of the present petition may be overlooked and should not
be taken against petitioners.
WHEREFORE, the petition is GRANTED. The Decision of the Court of
Appeals is REVERSED and SET ASIDE and the decision of the NLRC dated
30 March 2001 which affirmed in toto the decision of the Labor Arbiter dated
29 May 1998 ordering respondent Coca-Cola Bottlers Phils., Inc., to reinstate
Prudencio Bantolino, Nilo Espina, Eddie Ladica, Arman Queling, Rolando
Nieto, Ricardo Bartolome, Eluver Garcia, Eduardo Garcia and Nelson
Manalastas to their former positions as regular employees, and to pay them
their full back wages, with the exception of Prudencio Bantolino whose back
wages are yet to be computed upon proof of his dismissal, is REINSTATED,
with the MODIFICATION that herein petition is DENIED insofar as it concerns
Nestor Romero who entered into a valid and binding Compromise
Agreement and Release, Waiver and Quitclaim with respondent company.
SO ORDERED.
Quisumbing, Austria-Martinez, and Callejo, Sr., JJ., concur.
 SECOND DIVISION

RICO ROMMEL ATIENZA, G.R. No. 177407

Petitioner,
Present:
NACHURA,
Acting Chairperson,
PERALTA,
- versus - DEL CASTILLO,*
VILLARAMA, JR.,** and
MENDOZA, JJ.

Promulgated:
BOARD OF MEDICINE and EDITHA
SIOSON, February 9, 2011
Respondents.

x------------------------------------------------------------------------------------x

DECISION

NACHURA, J.:

Before us is a petition for review on certiorari under Rule 45 of the Rules of Court,
assailing the Decision[1] dated September 22, 2006 of the Court of Appeals (CA) in
CA-G.R. SP No. 87755. The CA dismissed the petition for certiorari filed by
petitioner Rico Rommel Atienza (Atienza), which, in turn, assailed the
Orders[2] issued by public respondent Board of Medicine (BOM) in Administrative
Case No. 1882.

The facts, fairly summarized by the appellate court, follow.

Due to her lumbar pains, private respondent Editha Sioson went to Rizal
Medical Center (RMC) for check-up on February 4, 1995. Sometime in
1999, due to the same problem, she was referred to Dr. Pedro Lantin III
of RMC who, accordingly, ordered several diagnostic laboratory tests.
The tests revealed that her right kidney is normal. It was ascertained,
however, that her left kidney is non-functioning and non-visualizing.
Thus, she underwent kidney operation in September, 1999.

On February 18, 2000, private respondents husband, Romeo Sioson (as

complainant), filed a complaint for gross negligence and/or
incompetence before the [BOM] against the doctors who allegedly
participated in the fateful kidney operation, namely: Dr. Judd dela Vega,
Dr. Pedro Lantin, III, Dr. Gerardo Antonio Florendo and petitioner Rico
Rommel Atienza.

It was alleged in the complaint that the gross negligence and/or

incompetence committed by the said doctors, including petitioner,
consists of the removal of private respondents fully functional right
kidney, instead of the left non-functioning and non-visualizing kidney.

The complaint was heard by the [BOM]. After complainant Romeo

Sioson presented his evidence, private respondent Editha Sioson, also
named as complainant there, filed her formal offer of documentary
evidence. Attached to the formal offer of documentary evidence are her
Exhibits A to D, which she offered for the purpose of proving that her
kidneys were both in their proper anatomical locations at the time she
was operated. She described her exhibits, as follows:

EXHIBIT A the certified photocopy of the X-ray Request

form dated December 12, 1996, which is also marked as
Annex 2 as it was actually originally the Annex to x x x Dr.
Pedro Lantin, IIIs counter affidavit filed with the City
Prosecutor of Pasig City in connection with the criminal
complaint filed by [Romeo Sioson] with the said office, on
which are handwritten entries which are the interpretation
of the results of the ultrasound examination. Incidentally,
this exhibit happens to be the same as or identical to the
certified photocopy of the document marked as Annex 2 to
the Counter-Affidavit dated March 15, 2000, filed by x x x
Dr. Pedro Lantin, III, on May 4, 2000, with this Honorable
Board in answer to this complaint;

EXHIBIT B the certified photo copy of the X-ray request

form dated January 30, 1997, which is also marked as
 Annex 3 as it was actually likewise originally an Annex to
x x x Dr. Pedro Lantin, IIIs counter-affidavit filed with the
Office of the City Prosecutor of Pasig City in connection
with the criminal complaint filed by the herein complainant
with the said office, on which are handwritten entries which
are the interpretation of the results of the examination.
Incidentally, this exhibit happens to be also the same as or
identical to the certified photo copy of the document
marked as Annex 3 which is likewise dated January 30,
1997, which is appended as such Annex 3 to the counter-
affidavit dated March 15, 2000, filed by x x x Dr. Pedro
Lantin, III on May 4, 2000, with this Honorable Board in
answer to this complaint.

EXHIBIT C the certified photocopy of the X-ray request

form dated March 16, 1996, which is also marked as Annex
4, on which are handwritten entries which are the
interpretation of the results of the examination.

EXHIBIT D the certified photocopy of the X-ray request

form dated May 20, 1999, which is also marked as Annex
16, on which are handwritten entries which are the
interpretation of the results of the examination.
Incidentally, this exhibit appears to be the draft of the
typewritten final report of the same examination which is
the document appended as Annexes 4 and 1 respectively to
the counter-affidavits filed by x x x Dr. Judd dela Vega and
Dr. Pedro Lantin, III in answer to the complaint. In the case
of Dr. dela Vega however, the document which is marked
as Annex 4 is not a certified photocopy, while in the case of
Dr. Lantin, the document marked as Annex 1 is a certified
photocopy. Both documents are of the same date and
typewritten contents are the same as that which are written
on Exhibit D.

Petitioner filed his comments/objections to private respondents [Editha

Siosons] formal offer of exhibits. He alleged that said exhibits are
inadmissible because the same are mere photocopies, not properly
identified and authenticated, and intended to establish matters which are
hearsay. He added that the exhibits are incompetent to prove the purpose
for which they are offered.
 Dispositions of the Board of Medicine

The formal offer of documentary exhibits of private respondent [Editha

Sioson] was admitted by the [BOM] per its Order dated May 26, 2004. It
reads:

The Formal Offer of Documentary Evidence of [Romeo

Sioson], the Comments/Objections of [herein petitioner]
Atienza, [therein respondents] De la Vega and Lantin, and
the Manifestation of [therein] respondent Florendo are
hereby ADMITTED by the [BOM] for whatever purpose
they may serve in the resolution of this case.

Let the hearing be set on July 19, 2004 all at 1:30 p.m. for
the reception of the evidence of the respondents.

SO ORDERED.

Petitioner moved for reconsideration of the abovementioned Order

basically on the same reasons stated in his comment/objections to the
formal offer of exhibits.

The [BOM] denied the motion for reconsideration of petitioner in its

Order dated October 8, 2004. It concluded that it should first admit the
evidence being offered so that it can determine its probative value when
it decides the case. According to the Board, it can determine whether the
evidence is relevant or not if it will take a look at it through the process
of admission. x x x.[3]

Disagreeing with the BOM, and as previously adverted to, Atienza filed a
petition for certiorari with the CA, assailing the BOMs Orders which admitted
Editha Siosons (Edithas) Formal Offer of Documentary Evidence. The CA
dismissed the petition for certiorari for lack of merit.

Hence, this recourse positing the following issues:

I. PROCEDURAL ISSUE:
 WHETHER PETITIONER ATIENZA AVAILED OF THE PROPER
REMEDY WHEN HE FILED THE PETITION
FOR CERTIORARI DATED 06 DECEMBER 2004 WITH THE
COURT OF APPEALS UNDER RULE 65 OF THE RULES OF
COURT TO ASSAIL THE ORDERS DATED 26 MAY 2004
AND 08 OCTOBER 2004 OF RESPONDENT BOARD.

II. SUBSTANTIVE ISSUE:

WHETHER THE COURT OF APPEALS COMMITTED GRAVE

REVERSIBLE ERROR AND DECIDED A QUESTION OF
SUBSTANCE IN A WAY NOT IN ACCORDANCE WITH
LAW AND THE APPLICABLE DECISIONS OF THE
HONORABLE COURT WHEN IT UPHELD THE ADMISSION
OF INCOMPETENT AND INADMISSIBLE EVIDENCE BY
RESPONDENT BOARD, WHICH CAN RESULT IN THE
DEPRIVATION OF PROFESSIONAL LICENSE A PROPERTY
RIGHT OR ONES LIVELIHOOD.[4]

We find no reason to depart from the ruling of the CA.

Petitioner is correct when he asserts that a petition for certiorari is the proper
remedy to assail the Orders of the BOM, admitting in evidence the exhibits of
Editha. As the assailed Orders were interlocutory, these cannot be the subject of an
appeal separate from the judgment that completely or finally disposes of the
case.[5] At that stage, where there is no appeal, or any plain, speedy, and adequate
remedy in the ordinary course of law, the only and remaining remedy left to
petitioner is a petition for certiorari under Rule 65 of the Rules of Court on the
ground of grave abuse of discretion amounting to lack or excess of jurisdiction.

However, the writ of certiorari will not issue absent a showing that the
BOM has acted without or in excess of jurisdiction or with grave abuse of
discretion. Embedded in the CAs finding that the BOM did not exceed its
jurisdiction or act in grave abuse of discretion is the issue of whether the exhibits
of Editha contained in her Formal Offer of Documentary Evidence are
inadmissible.
 Petitioner argues that the exhibits formally offered in evidence by Editha: (1)
violate the best evidence rule; (2) have not been properly identified and
authenticated; (3) are completely hearsay; and (4) are incompetent to prove their
purpose. Thus, petitioner contends that the exhibits are inadmissible evidence.

We disagree.

To begin with, it is well-settled that the rules of evidence are not strictly
applied in proceedings before administrative bodies such as the BOM. [6] Although
trial courts are enjoined to observe strict enforcement of the rules of evidence,[7] in
connection with evidence which may appear to be of doubtful relevancy,
incompetency, or admissibility, we have held that:

[I]t is the safest policy to be liberal, not rejecting them on doubtful or

technical grounds, but admitting them unless plainly irrelevant,
immaterial or incompetent, for the reason that their rejection places them
beyond the consideration of the court, if they are thereafter found
relevant or competent; on the other hand, their admission, if they turn out
later to be irrelevant or incompetent, can easily be remedied by
completely discarding them or ignoring them.[8]

From the foregoing, we emphasize the distinction between the admissibility of

evidence and the probative weight to be accorded the same pieces of
evidence. PNOC Shipping and Transport Corporation v. Court of
Appeals[9] teaches:

Admissibility of evidence refers to the question of whether or not the

circumstance (or evidence) is to be considered at all. On the other hand,
the probative value of evidence refers to the question of whether or not it
proves an issue.

Second, petitioners insistence that the admission of Edithas exhibits violated

his substantive rights leading to the loss of his medical license is misplaced.
Petitioner mistakenly relies on Section 20, Article I of the Professional Regulation
Commission Rules of Procedure, which reads:
 Section 20. Administrative investigation shall be conducted in accordance
with these Rules. The Rules of Court shall only apply in these proceedings by
analogy or on a suppletory character and whenever practicable and convenient.
Technical errors in the admission of evidence which do not prejudice the
substantive rights of either party shall not vitiate the proceedings.[10]

As pointed out by the appellate court, the admission of the exhibits did not
prejudice the substantive rights of petitioner because, at any rate, the fact sought to
be proved thereby, that the two kidneys of Editha were in their proper anatomical
locations at the time she was operated on, is presumed under Section 3, Rule 131
of the Rules of Court:

Sec. 3. Disputable presumptions. The following presumptions are

satisfactory if uncontradicted, but may be contradicted and overcome by
other evidence:

xxxx

(y) That things have happened according to the ordinary course of nature
and the ordinary habits of life.

The exhibits are certified photocopies of X-ray Request Forms dated

December 12, 1996, January 30, 1997, March 16, 1996, and May 20, 1999, filed in
connection with Edithas medical case. The documents contain handwritten entries
interpreting the results of the examination. These exhibits were actually attached as
annexes to Dr. Pedro Lantin IIIs counter affidavit filed with the Office of the City
Prosecutor of Pasig City, which was investigating the criminal complaint for
negligence filed by Editha against the doctors of Rizal Medical Center (RMC) who
handled her surgical procedure. To lay the predicate for her case, Editha offered
the exhibits in evidence to prove that her kidneys were both in their proper
anatomical locations at the time of her operation.

The fact sought to be established by the admission of Edithas exhibits, that

her kidneys were both in their proper anatomical locations at the time of her
operation, need not be proved as it is covered by mandatory judicial notice.[11]
 Unquestionably, the rules of evidence are merely the means for ascertaining
the truth respecting a matter of fact.[12] Thus, they likewise provide for some facts
which are established and need not be proved, such as those covered by judicial
notice, both mandatory and discretionary.[13] Laws of nature involving the physical
sciences, specifically biology,[14] include the structural make-up and composition
of living things such as human beings. In this case, we may take judicial notice that
Edithas kidneys before, and at the time of, her operation, as with most human
beings, were in their proper anatomical locations.
Third, contrary to the assertion of petitioner, the best evidence rule is inapplicable.
Section 3 of Rule 130 provides:

1. Best Evidence Rule

Sec. 3. Original document must be produced; exceptions. When the

subject of inquiry is the contents of a document, no evidence shall be
admissible other than the original document itself, except in the
following cases:

(a) When the original has been lost or destroyed, or cannot be produced
in court, without bad faith on the part of the offeror;

(b) When the original is in the custody or under the control of the party
against whom the evidence is offered, and the latter fails to produce it
after reasonable notice;

(c) When the original consists of numerous accounts or other documents

which cannot be examined in court without great loss of time and the
fact sought to be established from them is only the general result of the
whole; and

(d) When the original is a public record in the custody of a public officer
or is recorded in a public office.

The subject of inquiry in this case is whether respondent doctors before the BOM
are liable for gross negligence in removing the right functioning kidney of Editha
instead of the left non-functioning kidney, not the proper anatomical locations of
Edithas kidneys. As previously discussed, the proper anatomical locations of
Edithas kidneys at the time of her operation at the RMC may be established not
only through the exhibits offered in evidence.

Finally, these exhibits do not constitute hearsay evidence of the anatomical

locations of Edithas kidneys. To further drive home the point, the anatomical
positions, whether left or right, of Edithas kidneys, and the removal of one or both,
may still be established through a belated ultrasound or x-ray of her abdominal
area.

In fact, the introduction of secondary evidence, such as copies of the exhibits, is

allowed.[15] Witness Dr. Nancy Aquino testified that the Records Office of RMC
no longer had the originals of the exhibits because [it] transferred from the
previous building, x x x to the new building.[16] Ultimately, since the originals
cannot be produced, the BOM properly admitted Edithas formal offer of evidence
and, thereafter, the BOM shall determine the probative value thereof when it
decides the case.

WHEREFORE, the petition is DENIED. The Decision of the Court of

Appeals in CA-G.R. SP No. 87755 is AFFIRMED. Costs against petitioner.

SO ORDERED.
G.R. No. 195640 December 4, 2012

SUGAR REGULATORY ADMINISTRATION, represented by its Administrator, Petitioner,

vs.
ENCARNACION B. TORMON, EDGARDO B. ALISAJE, LOURDES M. DOBLE, TERESITA Q.
LIM, EDMUNDO R. JORNADAL, JIMMY C. VILLANUEVA , DEANNA M. JANCE, HENRY G.
DOBLE, REYNALDO D. LUZANA, MEDELYN P. TOQUILLO, SEVERINO A. ORLIDO,
RHODERICK V. ALIPOON, JONATHAN CORDERO, DANILO B. BISCOCHO, BELLO C.
LUCASAN, LUBERT V. TIVE, and the COMMISSION ON AUDIT, Respondents.

DECISION

PERALTA, J.:

Assailed in this petition for certiorari under Rule 64, in relation to Rule 65 of the Rules of Court, is
Decision No. 2010-1461 dated December 30,2010 of the Commission on Audit (COA).

The antecedent facts are as follows:

Private respondents, namely: Encarnacion B. Tormon, Edgardo B. Alisaje, Lourdes M. Doble,

Teresita Q. Lim, Edmundo R. Jornadal, Jimmy C. Villanueva , Deanna M. Jance, Henry G. Doble,
Reynaldo D. Luzana, Medelyn P. Toquillo, Severino A. Orlido, Rhoderick V. Alipoon, Jonathan
Cordero, Danilo B. Biscocho, Bello C. Lucasan, Lubert V. Tive, were former employees of Philippine
Sugar Institute (PHILSUGIN) and the Sugar Quota Administration (SQA). On February 2, 1974,
Presidential Decree (P.D.) No. 388 was issued creating the Philippine Sugar Commission
(PHILSUCOM). Under the said decree, PHILSUGIN and SQA shall be abolished upon the
organization of PHILSUCOM and all the former's assets, liabilities and records shall be transferred to
the latter and the personnel of the abolished agencies who may not be retained shall be entitled to
retirement/gratuity and incentive benefits.

In September 1977, PHILSUGIN and SQA were abolished and private respondents were separated
from the service; thus, they were paid their retirement/gratuity and incentive benefits. In the same
year, private respondents were reinstated by PHILSUCOM subject to the condition that the former
would refund in full the retirement/gratuity and incentive benefits they received from PHILSUGIN or
SQA. PHILSUCOM Consultant, Eduardo F. Gamboa, wrote:

We have received orders from the Main Office to require you to refund in full the unexpired portion of
the money value of the retirement or lay-off gratuity you received as called for in Office
Memorandum No. 4, series of 1977, dated December 5, 1977, in view of your reinstatement in the
service.

xxxx

In connection herewith, you are therefore directed to make the necessary refund of the above-
mentioned amount to our Local Accounting Department and to inform the Personnel Department,
when refund is made. Failure on your part to make the necessary refund will constrain us to
recommend corrective measures.2

On May 28, 1986, Executive Order (E.O.) No. 18, series of 1986 was issued wherein the Sugar
Regulatory Administration (petitioner SRA) replaced PHILSUCOM. PHILSUCOM's assets and
records were all transferred to petitioner SRA which also retained some of the former's personnel
which included the private respondents.

On July 29, 2004, E.O. No. 339 was issued, otherwise known as Mandating the Rationalization of
the Operations and Organization of the SRA, for the purpose of strengthening its vital services and
refocusing its resources to priority programs and activities, and reducing its personnel with the
payment of retirement gratuity and incentives for those who opted to retire from the service. Among
those separated from the service were private respondents. Under the SRA Rationalization
Program, petitioner computed its employees' incentives and terminal leave benefits based on their
creditable years of service contained in their respective service records on file with petitioner and
validated by the Government Service and Insurance System (GSIS). The computation was then
submitted to the Department of Budget and Management (DBM) for approval and request of funds.
The DBM approved the same and released the disbursement vouchers for processing of the
incentive benefits.

However, in the course of the implementation of its rationalization plan, petitioner found out that
there was no showing that private respondents had refunded their gratuity benefits received from
PHILSUGIN or SQA. Hence, petitioner considered private respondents' length of service as having
been interrupted which commenced only at the time they were re-employed by PHILSUCOM in
1977. Petitioner then recomputed private respondents' retirement and incentive benefits and paid
only the 75% equivalent of the originally computed benefits and withheld the remaining 25% in view
of the latter's inability to prove the refund.

Private respondents requested petitioner to compute their incentive benefits based on their length of
service to include their years of service with PHILSUGIN or SQA taking into consideration their
refund of gratuity benefits to PHILSUCOM at the time of their re-employment in 1977. On January 4,
2007, then petitioner's Administrator, James C. Ledesma, issued a memorandum3 declaring the
services of its employees affected by the Rationalization Program, which included private
respondents, terminated effective on January 15, 2007. Under Board Resolution No. 2007-
0554 dated June 14, 2007, petitioner denied private respondents' requests for the latter's failure to
submit proofs of refund of gratuity received from PHILSUGIN or SQA.

On September 6, 2007, private respondents wrote a letter5 addressed to then Commission on Audit
(COA) Chairman, Guillermo N. Carague, asking the COA to order petitioner to pay the balance
representing the 25% of their retirement and incentive benefits withheld by petitioner. They claimed
that they had already refunded the full amount of the incentive benefits through salary deductions
and since petitioner could no longer find the PHILSUCOM payrolls reflecting those deductions,
private respondents submitted the affidavits of Messrs. Hilario T. Cordova6 and Nicolas L. Meneses
Jr.,7 petitioner's Chief, Administrative Division, and Manager, Administrative and Finance
Department, respectively, both executed in March 2007, attesting to the fact of refund.

Petitioner filed its Answer8 thereto contending among others that since private respondents alleged
payment, they were duty-bound to present evidence substantiating the said refund; that no records
of payments existed to clearly establish their claim, thus, their resort to secondary evidence which
were the sworn affidavits of petitioner's former officials were insufficient to prove the fact of the
alleged payment.

On October 14, 2009, the COA rendered Decision No. 2009 -100,9 with the following dispositive
portion, to wit:
WHEREFORE, foregoing premises considered, this Commission rules that the affidavits presented
by claimants are insufficient proofs that they have refunded to PHILSUCOM the gratuity/incentive
benefits they received from PHILSUGIN/SQA.

Evidence other than the affidavits must be presented to substantially prove their claims. Also, all the
benefits, gratuity, incentive and retirement they received upon their separation from PHILSUGIN or
SQA must be accounted for and refunded to SRA before the requested incentive benefit is
computed based on their length of government service reckoned from the time they were employed
with PHILSUGIN or SQA.10

In so ruling, the COA found that since private respondents alleged payment, they had the burden of
proving the same by clear and positive evidence; that the affidavits of Messrs. Cordova and
Meneses, Jr. stating that private respondents had refunded to PHILSUCOM the benefits they
received from PHILSUGIN/SQA were not the best evidence of such refunds; that an affidavit was
made without notice to the adverse party or opportunity to cross examine; and that the contents of
these affidavits were too general and did not state private respondents’ respective final payments.

Private respondents filed their motion for reconsideration which was opposed by petitioner.

On December 30, 2010, the COA rendered Decision No. 2010-146 granting private respondents'
motion for reconsideration, the dispositive portion of which reads:

WHEREFORE, premises considered, the instant Motion for Reconsideration is hereby GRANTED.
Accordingly, COA Decision No. 2009-100 is hereby REVERSED and [SET] ASIDE. The SRA is
directed to release to movants the amount representing the 25% balance of their incentive and
terminal leave benefits.11

In its decision, the COA observed that private respondents had filed a separate but related complaint
with the Civil Service Commission (CSC). It found that while their complaint with the CSC was
denominated as illegal termination/backwages and entitlements, the main thrust of their complaint
was to compel the payment of the 25% balance of their total incentives and terminal leave benefits
withheld by petitioner, which was the same demand made in their letter to Chairman Carague whose
decision is the subject of the motion for reconsideration, thus, forum shopping existed. The COA
also noted that in their Supplement to Motion for Reconsideration/Manifestation filed on November
24, 2009, private respondents mentioned the ruling of the CSC12 in their favor and they now disputed
the COA’s jurisdiction to rule on their demand contending that it is the CSC which has jurisdiction
over cases involving government reorganization; and that the CSC had issued a Resolution granting
private respondents' motion for execution of the CSC resolution. Notwithstanding, however, the COA
found that it did not lose jurisdiction over the present case and went on to decide the claim on the
merits and disregarded the CSC Resolution.

The COA ruled that the affidavits submitted were not secondary evidence within the context of
Section 5, Rule 130 of the Rules of Court, hence, admissible in evidence, since technical rules of
procedure and evidence are not strictly applied in administrative proceedings. The COA found in the
records certain significant circumstances which, when taken together with the affidavits, established
that indeed private respondents had refunded the incentives in question. Since private respondents
had discharged their burden of proof, it was incumbent on petitioner to discharge the burden of
evidence that respondents had not paid the said incentives; that it was the PHILSUCOM, then
petitioner, being the successor of PHILSUGIN and SQA, that had been tasked with the official
custody of all the records and books of their predecessors, as mandated under Section 10 of
Presidential Decree No. 388; that if petitioner's Accounting Division cannot issue a certification
because it has no records, it is never an excuse to shift the burden to the employees.
Petitioner is now before us raising the following issues, to wit:

1. Whether or not respondent Commission erred and gravely abused its discretion when it
gave credence to the affidavits of Mr. Hilario T. Cordova, then Chief, Administrative Division,
SRA, and Mr. Nicolas L. Meneses, Jr., then Manager, Administrative and Finance
Department plainly alleging that the gratuity/incentives have been refunded by the private
respondents.

2. Whether or not public respondent Commission on Audit erred and gravely abused its
discretion in making assumptions or suppositions out of certain circumstances which were
not even alleged by private respondents and in arriving at a conclusion out of the same in
favor of private respondents.

3. Whether or not public respondent Commission on Audit erred and gravely abused its
discretion in finding substantial evidence that private respondents refunded the gratuity
incentives in question.13

The issue for resolution is whether the COA committed grave abuse of discretion amounting to lack
of jurisdiction in directing petitioner to pay the 25% balance of private respondents' incentive and
terminal leave benefits withheld from the submitted computation of petitioner and duly funded by the
DBM.

We find no merit in the petition.

Petitioner withheld 25% of private respondents' incentive and terminal leave benefits because of
their failure to present evidence of refund of the amounts of retirement and incentive benefits earlier
received from PHILSUGIN/SQA. On the other hand, private respondents claim that they had already
refunded these benefits through salary deduction, therefore, they are entitled to the payment of the
amounts withheld by petitioner. The burden of proof is on private respondents to prove such refund.
One who pleads payment has the burden of proving it.14 Even where the creditor alleges non-
payment, the general rule is that the onus rests on the debtor to prove payment, rather than on the
creditor to prove non-payment.15 The debtor has the burden of showing with legal certainty that the
obligation has been discharged by payment.16

Well settled also is the rule that a receipt of payment is the best evidence of the fact of
payment.17 In Monfort v. Aguinaldo,18 the receipts of payment, although not exclusive, were deemed to
be the best evidence. Private respondents, however, could not present any receipt since they
alleged that their payments were made through salary deductions and the payrolls which supposedly
contained such deductions were in petitioner's possession which had not been produced. In order to
prove their allegations of refund, private respondents submitted the affidavits of Messrs. Cordova
and Meneses, Jr., which we successively quote in part, to wit:

Mr. Cordova states:

That I was the Administrative Officer II of the defunct Philippine Sugar Institute when it was
abolished in 1977; that I hold the same position when the Philippine Sugar Commission took over
the functions of PHILSUGIN from that year up to 1986;

That I continued to be the head of Personnel Division when Sugar Regulatory Administration
replaced PHILSUCOM in 1986 and retired as Division Chief II of the Administrative Division on July
31, 2003;
That during my incumbency in said positions, I have personal knowledge of the paymen/refund of
ex-PHILSUGIN employees separated from service but reinstated in PHILSUCOM by way of salary
deduction through payroll;

That Ms. Encarnacion Tormon, et al., upon return to service with PHILSUCOM, refunded the amount
of the gratuities they received from PHILSUGIN in the months following/succeeding upon their
appointment as reinstated employees of PHILSUCOM;

That their status as reinstated employees are officially marked in their individual service records duly
authenticated by myself as Chief of Personnel Division and validated by the Government Service
Insurance System as proven by GSIS computation of their creditable years.19

On the other hand, Mr. Meneses Jr., states:

That I was the Chief Internal Auditor of the defunct Philippine Sugar Institute when it was abolished
in 1977; that I hold a key position in the Budget and Accounting Division when the Philippine Sugar
Commission took over the functions of PHILSUGIN from that year up to 1986;

That I later became Division Chief I of [the] Budget Division in the Sugar Regulatory Administration
in 1988 and retired as Manager of the Administrative and Finance Department on July 31, 2003;

That during my incumbency in said positions, I have personal knowledge of the payment/refund of
ex-PHILSUGIN employees separated from service and reinstated in PHILSUCOM;

That Ms. Encarnacion Tormon et al., upon return to service with PHILSUCOM, refunded the amount
of the gratuities they received from PHILSUGIN;

That their status as reinstated employees are officially marked in their individual service records duly
authenticated by the Chief of Personnel Division and validated by GSIS.20

Messrs. Cordova, being petitioner's head of the Personnel Department, and Meneses, Jr., as
petitioner's Chief of Budget Division, and later Manager of the Administrative and Finance
Department, were in the best positions to attest to the fact of private respondents' refund through
salary deductions of the amounts of retirement and incentive benefits previously received, especially
since these officials were in those departments since PHILSUCOM took over in 1977 and later with
petitioner until their retirement in 2003. There was nothing on record to show that Messrs. Cordova
and Meneses, Jr. were actuated with any ill motive in the execution of their affidavits attesting to the
fact of refund.

The general rule is that administrative agencies are not bound by the technical rules of evidence. It
can accept documents which cannot be admitted in a judicial proceeding where the Rules of Court
are strictly observed. It can choose to give weight or disregard such evidence, depending on its
trustworthiness.21 Here, we find no grave abuse of discretion committed by the COA when it admitted
the affidavits of Messrs. Cordova and Meneses, Jr. and gave weight to them in the light of the other
circumstances established by the records which will be shown later in the decision.

Petitioner claims that the affiants attested on a matter which happened 30 years ago; thus, how
could they recall that each of the 16 employees had actually refunded the gratuity/incentives way
back in 1977; that each of the private respondents held different positions with salaries different from
each other and the dates when they respectively re-assumed service in the government differed
from each other; that it may not even be entirely correct that all 16 respondents refunded the gratuity
incentives in question by salary deduction.

We are not persuaded.

Significantly, Messrs. Cordova and Meneses, Jr. were petitioner's former officials who held key
positions in the two divisions, namely, Personnel and Accounting Divisions, where private
respondents were directed by then petitioner's Consultant Gamboa to make the necessary refunds
for their retirement and incentive pay. Thus, if no refunds were made, these officials could have
reported the same to Gamboa, who would have taken corrective measures as he threatened to do
so if private respondents failed to make the necessary refunds. Notably, there is no showing that
corrective measures had been taken. Moreover, as we said, while the COA admitted the affidavits, it
did not rely solely on those affidavits to conclude that refunds were already made by private
respondents. The matter of refund was proven by several circumstances which the COA found
extant in the records of the case. We find apropos to quote the COA findings in this wise:

First, movants were reemployed by PHILSUCOM with the condition that they must return the
benefits they had already received. In his 16 March 1978 letter, Mr. Eduardo F. Gamboa, directed
Ms. Tormon to refund the amount and to inform the Personnel Department when the refund was
made. He warned Ms. Tormon to make the refund or they will be constrained to recommend
corrective measures. The fact was that claimants were reinstated. That management did not take
any corrective measures to compel the refund – except perhaps, the enforced salary deduction
which claimants said was the mode of refund undertaken - is a point in favor of claimants. It would
be unbelievable that in all these years, from 1977 to 2007, the SRA management, indubitably having
the higher authority, just slept on its right to enforce the refund and did nothing about it. The natural
and expected action that SRA ought to have taken was to enforce the refund through salary
deduction, not through voluntary direct payment since the latter option does not carry with it the
mandatory character of an automatic salary deduction.

Second, a certain Mr. Henry Doble, one of the movants, was promoted from Emergency Employee,
a temporary status, to senior machine cutting operator with permanent status. If Mr. Doble had not
refunded his gratuity, it was more reasonable to suppose that SRA would not have promoted him.

Third, COA Directors Rosemarie L. Lerio and Divina M. Alagon, CGS and SRA ATL22 Antonio M.
Malit, to whom the case was coursed through for comments, did not mention, even in passing, of
any audit finding in the Annual Audit Reports (AARS) regarding the unrefunded incentives received
by claimants The silence of the AARs for 30 years would only lend credence that theses refunds
were made.

Fourth, under the SRA Rationalization program, the affected employees' incentive and terminal
leave benefits were computed based on their creditable years of services as contained in their
respective service records with the agency as validated by the GSIS. Accordingly, SRA computed
movants' incentive and terminal leave benefits as of December 31, 2006 which was approved by the
Department of Budget and Management (DBM) Secretary Rolando Andaya. This only showed that
even the SRA was convinced that movants had no more financial accountability with the SRA at the
time.1âw phi 1

Fifth, then SRA Administrator James C. Ledesma informed movants that not one of the records of
the payments they claimed was available at the office; thus, the SRA could not be definite as to the
actual payments made by them and the equivalent periods corresponding thereto, Also, Ms. Amelita
A. Papasin, Accountant IV, Accounting Unit, SRA, Bacolod, stated that they could not find any
record showing payments made as claimed by Ms. Tormon, et al., to refund the severance gratuities
paid to them during their termination on September 30, 1977. Indeed, the SRA could not comply with
the request of Mr. Antonio M. Malit, Audit Team leader (ATL), SRA, to produce copies of payroll or
index of payments, or any accounting records covering the 32-year period which would have shown
whether movants paid or did not pay the required refund. These payrolls and other records would
have conclusively established the fact of payment or non-payment, But then all the SRA could say
was there is no record of such payment. Absence of record is different from saying there was no
payment.23

Factual findings of administrative bodies charged with their specific field of expertise, are afforded
great weight by the courts, and in the absence of substantial showing that such findings were made
from an erroneous estimation of the evidence presented, they are conclusive, and in the interest of
stability of the governmental structure, should not be disturbed.24

Petitioner's claim that the COA made its own assumptions which were not even based on the
allegations made by private respondents in any of their pleadings is devoid of merit. In their Reply to
petitioner's Supplemental Comment/Opposition to private respondents' motion for reconsideration,
private respondents had alleged some of these above- mentioned circumstances to support their
claim that refunds had already been made. We also find that the records of the case support the
above-quoted circumstances enumerated by the COA.

Considering that private respondents had introduced evidence that they had refunded their
retirement and incentive benefits through salary deduction, the burden of going forward with the
evidence- as distinct from the general burden of proof- shifts to the petitioner, who is then under a
duty of producing some evidence to show non-payment.25 However, the payroll to establish whether
or not deductions had been made from the salary of private respondents were in petitioner's custody,
but petitioner failed to present the same due to the considerable lapse of time.

All told, we find no grave abuse of discretion amounting to lack or excess of jurisdiction committed
by the COA in rendering its assailed decision. There is grave abuse of discretion when there is an
evasion of a positive duty or a virtual refusal to perform a duty enjoined by law or to act in
contemplation of law as when the judgment rendered is not based on law and evidence but on
caprice, whim and despotism,26 which is wanting in this case.

WHEREFORE, the petition is DISMISSED. Decision No. 2010-146 dated December 30, 2010 of the
Commission on Audit is hereby AFFIRMED.

SO ORDERED.
 SECOND DIVISION

G.R. No. 208567 November 26, 2014

JEANETTE V. MANALO, VILMA P. BARRIOS, LOURDES LYNN MICHELLE FERNANDEZ and

LEILA B. TAINO,Petitioners,
vs.
TNS PHILIPPINES INC., and GARY OCAMPO, Respondents.

DECISION

MENDOZA, J.:

This petition for review on certiorari under Rule 45 of the Rules of Court assails the January 29,
2013 Decision1 and the August 7, 2013 Resolution2 of the Court of Appeals (CA), in CA-G.R. SP No.
117637, which set aside the July 23, 2010 Decision3 of the National Labor Relations Commission
(NLRC) and its October 28, 2010 Resolution4 and reinstated the May 29, 2009 Decision5 of the Labor
Arbiter's finding that petitioners were project employees.

Respondent TNS Philippines Inc. (TNS), with Gary Ocampo as its president and general manager,
was engaged primarily in the business of marketing research and information, as well as research
consultancy and other value-added services to a widebase of clients, both local and
international.6 As a market research facility, TNS conducted public surveys about consumer goods,
products, merchandise and/or services of its clients.7 TNS hired several field personnel on a project-
to-project basis whose functions were the following: a) to gather data on consumer goods,
commodities, merchandise, and such other products as requested by clients, through personal
interviews, telephone interviews and/or such other modes akin to the foregoing; and b) to submit the
gathered data to the company for evaluation and/or analysis.8

Petitioners Jeanette V. Manalo, Vilma P. Barrios, Lourdes Lynn Michelle Fernandez, and Leila B.
Taiño (petitioners) were hired by TNS as field personnel on various dates starting 1996 for several
projects. They were made to sign a project-to-project employment contract. Thereafter, TNS would
file the corresponding termination report with the Department of Labor and Employment Regional
Office (DOLE-RO).9

Petitioners were likewise assigned office-based tasks for which they were required to be in the office
from 9:00 o’clock in the morning to 6:00 o’clock in the evening, but most of the time, they worked
beyond 6:00 o’clock without receiving the corresponding overtime pay. These office based tasks
were not on a per project basis and petitioners did not sign any contract for these jobs. These
assignments were not reported to the DOLE either.10

Later in August 2008, a meeting among the Field Interviewers (FIs) was called by TNS’ field
manager. They were told that all old FIs assigned in the "tracking" projects would be pulled out
eventually and replaced by new FIs contracted from an agency. Old FIs would be assigned only to
"ad hoc" projects which were seasonal. This prompted petitioners to file a consolidated complaint for
regularization before the LA.11

On October 20, 2008, petitioners and TNS were required to file their respective position papers. On
October 21, 2008, petitioners were advised by TNS not to report for work anymore because they
were being pulled out from their current assignments and that they were not being lined up for any
continuing or incoming projects becauseit no longer needed their services. They were also asked to
surrender their company IDs.12 Petitioners, thereafter, filed a complaint for illegal dismissal, overtime
pay, damages, and attorney’s fees against TNS. Later, the labor cases for regularization and illegal
dismissal were consolidated.

On May 29, 2009, the LA rendered a decision,13 dismissing the complaint on the ground that
petitioners were found to be project employees who knew the nature of their positions as such at the
time of their employment and who agreed with full understanding that the contracts would lapse
upon completion of the project stated in their respective contracts.14 The LA further ruled that even if
petitioners were continuously rehired for several and different projects, the determining factor was
whether, at the time of hiring, the employment was fixed for a specific project or undertaking and its
completion was predetermined.15

The LA was also of the view that petitioners were not illegally dismissed because as project
employees, the employer-employee relationship was terminated upon completion of the project or
phase for which they were hired. The term of their employment was coterminus with the duration and
until the accomplishment of the project.16

As to the claim for overtime pay and damages, the LA held that petitioners were not entitled to them.
Field personnel were excluded from the coverage of the minimum requirements on hours of work
and overtime pay.

Aggrieved, petitioners filed anappeal before the NLRC. Consequently, the NLRC rendered its
judgment17 in favor of petitioners and reversed the LA ruling. Thus:

We note that, initially, complainants used to be project employees as shown by the samples of
project-to-project employment contracts, project clearance slips, and the establishment termination
reports adduced in evidence. Case records, however, show that the last time respondent company
filed an establishment termination report was in November 2007 indicating project completion on
November 30, 2007. What is clear though is that complainants were allowed to continue working
after November 30, 2007. Respondent company did not adduce in evidence employment contracts
relating to the latest employment of the complainants. In the absence of proof that the subsequent
employment of the complainants continued to be on a project-to-project basis under a contract of
employment, complainants are considered to have become regular employees after November 30,
2007. The failure to present contract of project employment means that the employees are regular.18

[Emphases supplied]

The NLRC further ruled that, being regular employees, petitioners were illegally dismissed because
TNS, who had the burden of proving legality in dismissal cases, failed to show how and why the
employment of petitioners was terminated on October 21, 2008.19 Thus, the NLRC set aside the LA
decision and held TNS liable for illegal dismissal, ordering the latter to pay petitioners their
respective backwages and separation pay.20

TNS moved for reconsideration, butits motion was denied. Thus, it filed a petition for certiorariwith
prayer for preliminary injunction and/or temporary restraining order before the CA. On January 29,
2013, the CA ruled in favor of TNS and opined that the projects assigned to petitioners were distinct
and separate from the other undertakings of TNS; that they wererequired to sign project-to-project
employment contracts; and that a corresponding termination report was made to DOLE for every
accomplished project. Further, it stated that the repeated re-hiring of petitioners for at least one (1)
year did not ipso facto convert their status to regular employees. According to the CA, the mere fact
that a project employee had worked on a specific project for more than one (1) year did not
necessarily change his status from project employee to regular or permanent employee.21
As to the issue of grave abuse of discretion, the CA held that the NLRC committed such abuse when
it refused to consider the pieces of evidence submitted by TNS during its determination of the merits
of the latter’s motion for reconsideration. It stressed that the technical rules of evidence were not
binding in labor cases,22 that even if the evidence was not submitted to the LA, the fact that it was
duly introduced on appeal before the NLRC was enough basis for it to admit them.23

Not in conformity, petitioners filed a motion for reconsideration but it was eventually denied.

Hence, this petition presenting the following

ARGUMENTS:

I. WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS ERRED IN HOLDING

THAT THE PETITIONERS ARE NOT REGULAR EMPLOYEES OF THE RESPONDENT
COMPANY.

II. WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS ERRED IN RULING
THAT THE HONORABLE NLRC COMMITTED GRAVE ABUSE OF DISCRETION.24

Petitioners assert that the factual circumstances of the case undoubtedly show their regular
employment status and that the NLRC correctly exercised its discretion. The respondents argue
otherwise insisting that the decision of the CA was correct.

The Court’s Ruling

At the outset, it must be stressed that the Court is not a trier of facts. In petitions for review under
Rule 45, the Court only resolves pure questions of law and is precluded from reviewing factual
findings of the lower tribunals, subject to certain exceptions. This case is an exception as "this Court
may review factual conclusions of the CA when they are contrary to those of the NLRC or of the
Labor Arbiter."25

Upon review of the records, the evidence failed to clearly, accurately, consistently, and convincingly
show that petitioners were still project employees of TNS.

Article 280 of the Labor Code, as amended, clearly defined a project employee as one whose
employment has been fixed for a specific project or undertaking the completion or termination of
which has been determined at the time of the engagement of the employee or where the work or
service to be performed is seasonal in nature and the employment is for the duration of the season.
Additionally, a project employee is one whose termination of his employment contract is reported to
the DOLE everytime the project for which he was engaged has been completed.

In their Comment,26 the respondents stressed that the NLRC decision was mainly anchored upon the
supposed lack of compliance with the termination report requirement under the applicable DOLE
Department Orders. The NLRC ruled that petitioners were regular employees for having been
allowed to continue working after the last submitted termination report. Thus, TNS submitted, albeit
belatedly, the termination reports from November 2007 up to the last termination report filed on
November 18, 2008, by attaching it to the motion for reconsideration filed before the NLRC.27

Although TNS belatedly submitted the supposed lacking termination reports, it failed to show the
corresponding project employment contracts of petitioners covering the period indicated in the said
termination reports. TNS itself stated in its motion for reconsideration28 before the NLRC that the
project employee status of the employee could be proved by the employment contracts signed
voluntarily by the employees and by the termination report filed with the DOLE after the completion
of every project.29 Yet, no project employment contracts were shown. It is well-settled that rules of
evidence shall be liberally applied in labor cases, but this does not detract from the principle that
piecemeal presentation of evidence is simply not in accord with orderly justice.30 The NLRC was
correct in saying that in the absence of proof that the subsequent employment of petitioners
continued to be on a project-to-project basis under a contract of employment, petitioners were
considered to have become regular employees.31

TNS contended that the repeated and successive rehiring of project employees does not qualify
petitioners asregular employees, as length of service is not the controlling determinant of the
employment tenure of a project employee, but whether the employment has been fixed for a specific
project or undertaking and its completion has been determined at the time of the engagement of the
employee. The repeated rehiring was only a natural consequence of the experience gained from
past service rendered in other projects.32

In Maraguinot, Jr. v. NLRC,33 the Court held that once a project or work pool employee has been: (1)
continuously, as opposed to intermittently, rehired by the same employer for the same tasks or
nature of tasks; and (2) these tasks are vital, necessary and indispensable to the usual business or
trade of the employer, then the employee must be deemed a regular employee. Although it is true
that the length of time of the employee’s service is not a controlling determinant of project
employment, it is vital in determining whether he was hired for a specific undertaking or in fact
tasked to perform functions vital, necessary and indispensable to the usual business or trade of the
employer.34 Petitioners’ successive re-engagement in order to perform the same kind of work firmly
manifested the necessity and desirability of their work in the usual business of TNS as a market
research facility.35Undisputed also is the fact that the petitioners were assigned office-based tasks
from 9:00 o’clock in the morning up to 6:00 o’clock in the evening, at the earliest, without any
corresponding remuneration.

The project employment scheme used by TNS easily circumvented the law and precluded its
employees from attaining regular employment status in the subtlest way possible. Petitioners were
rehired not intermittently, but continuously, contract after contract, month after month, involving the
very same tasks. They practically performed exactly the same functions over several years.
Ultimately, without a doubt, the functions they performed were indeed vital and necessary to the very
business or trade of TNS.

Granting arguendothat petitioners were rehired intermittently, a careful review of the project
employment contracts of petitioners reveals some other vague provisions. Oddly, one of the terms
and conditions in the said contract stated that:

1. The need for your services being determinable and for a specific project starting
____________ your employment will be for the duration of said project of the Company,
namely Project ___________ which is expected to be finished on _____________. The
Company shall have the option of renewing or extending the period ofthis agreement for
such time as it may be necessary to complete the project or because we need further time to
determine your competence on the job.

To the Court, the phrase "because we need further time to determine your competence on
the job" would refer to a probationary employment. Such phrase changes the tenor of the
contract and runs counter to the very nature of a project employment. TNS can, therefore,
extend the contract which was already fixed when it deemed it necessary to determine
whether or not the employee was qualified and fit for the job. Corollarily, TNS can likewise
 pre-terminate the contract not because the specific project was completed ahead of time, but
because of failure to qualify for the job. Consistently, the terms and conditions of the
contract, reads:

4. It is expressly agreed and understood that the Company may terminate your employment
after compliance with procedural requirements of law, without benefit of termination pay and
without any obligation on the part of the Company, in the event of any breach of any
conditions hereof: a) If the project is completed or cancelled before the expected date of
completion as specified in paragraph 1 hereof;

b) If we should find that you are not qualified, competent or efficient in the above-stated positions for
which you are hired in accordance with the company standards made known to you at the start of
your employment;

xxx

For said reason, at the outset, the supposed project employment contract was highly doubtful. In
determining the true nature of an employment, the entirety of the contract, not merely its designation
or by which it was denominated, is controlling. Though there is a rule that conflicting provisions in a
contract should be harmonized to give effect to all,36 in this case, however, harmonization is
impossible because project employment and probationary employment are distinct from one another
and cannot co-exist with each other. Hence, should there be ambiguity in the provisions of the
contract, the ruleis that all doubts, uncertainties, ambiguities and insufficiencies should be resolved
in favor of labor.37 This is in consonance with the constitutional policy of providing full protection to
labor.

In sum, petitioners are deemed to have become regular employees. As such, the burden of proving
the legality of their dismissal rests upon TNS. Having failed to discharge such burden ofproving a
just or authorized cause, TNS is liable for illegal dismissal.

Accordingly, as correctly ruled by the NLRC, each petitioner is entitled to backwages from the time
of their dismissal up to the finality or this decision plus separation pay, following their prayer for such
relief in lieu of reinstatement, computed as follows as of May 29, 2009:

a) Back.wages:

October 21, 2008 to May 29, 2009 = 7.27 mos.

₱382.00 x 26 days x 7.27 mos. = ₱72, 205.64

b) Separation Pay:

December 1, 2008 to May 29, 2009 = 5.93 mos.

₱382.00 x 26 days x 5.03 mps./12 = ₱4,908.10

₱77,113.80

Finally, nowhere in the NLRC resolution denying TNS' motion for reconsideration can it be found it
outrightly denied the said motion for belatedly submitting the lacking termination reports. In resolving
the motion, the NLRC also took into consideration the records of the case, meaning, including those
belatedly submitted, and despite review of these records, it still found the evidence insufficient to
overturn its decision against TNS.

To reiterate, the technical rules of evidence are not binding on labor tribunals. Such a rule,
1avv phi 1

however, is not a license for parties to a case to be remiss in their duty to present every and all
proofs, at the earliest opportunity, that will best support their claim and help the courts to fully,
exhaustively and speedily resolve the controversy.

WHEREFORE, the petition is GRANTED. The January 29, 2013 Decision and the August 7, 2013
Resolution of the Court of Appeals in CA-G.R. SP No. 117637 are SET ASIDE. The July 23, 2010
Decision of the National Labor Relations Commission is hereby RE INSTATED.

SO ORDERED.
G.R. No. 196142

VENUS B. CASTILLO, LEAH J. EVANGELISTA, DITAS M. DOLENDO, DAWN KAREN S. SY and

PRUDENTIAL PLANS, INC. EMPLOYEES UNION - FEDERATION OF FREE WORKERS (PPEU-
FFW), Petitioners,
vs.
PRUDENTIALIFE PLANS, INC., and/or JOSE ALBERTO T. ALBA, ATTY. CEFERINO A.
PATINO, JR., and ROSEMARIE DE LEMOS,, Respondent.

DECISION

DEL CASTILLO, J.:

In a labor case, the written statements of co-employees admitting their participation in a scheme to
defraud the employer are admissible in evidence. The argument by an employee that the said
statements constitute hearsay because the authors thereof were not presented for their cross-
examination does not persuade, because the rules of evidene are not strictly observed in
proceedings before the National Labor Relations Co)Illnission (NLRC), which are summary in nature
and decisions may be made on the basis ofposition papers.

This Petition for Review on Certiorari1 assails the January 14, 2011 Decision2 of the Court of Appeals
(CA) in CA-G.R. SP No. 111981 which reversed and set aside the dispositions of the NLRC, as well
as the CA's March 16,2011 Resolution3 denying reconsideration thereof.

Factual Antecedents

Individual petitioners Venus B. Castillo (Castillo), Leah J. Evangelista (Evangelista), Ditas M.

Dolendo (Dolendo), and Dawn Karen S. Sy (Sy) were regular employees of respondent Prudentialife
Plans, Inc. (Prudentialife), to wit:

Employee Name Position Date Employed

Venus B.Castillo CFP Clerk November 27, 1995
Leah J.Evangelista Data Encoder October 16, 2000
Ditas M. Dolendo Data Control Clerk February 2002
Dawn Karen S. Sy Data Control Clerk October 1999

Prudential Plans Employees Union – FFW (PPEU-FFW), on the other hand, is a local chapter of the
Federation of Free Workers and is the authorized bargaining agent of Prudentialife’s rank-and-file
employees. The individual petitioners are members of PPEU-FFW.

Respondent Prudentialife is an insurance company, while respondents Jose Alberto T. Alba (Alba),
Atty. Ceferino A. Patiño, Jr. (Patiño) and Rosemarie de Lemos (de Lemos) are its President, First
Vice-President for Corporate Services Group,and Assistant Vice-President for Human Resources,
espectively.

Under Section 4, Article X of the parties’ Collective Bargaining Agreement (CBA), Prudentialife
employees were granted an optical benefit allowance of P2,500.00 to subsidize prescription
eyeglasses for those who have developed vision problems in the course of employment. The
pertinent CBA provision states:

Section 4. Optical benefit. – The Company shall provide an amount not to exceed P2,500.00
inclusive of VAT to any covered employee to defray the cost of eyeglasses that may be prescribed
by the accredited HMO physician or employee’s personal optometrist. The benefit can be availed of
only once every two(2)years.4

Many Prudentialife employees – petitioners included – availed thereof and Prudentialife was flooded
with requests for reimbursement for eyeglasses the employees supposedly purchased from a single
outfit/supplier, Alavera Optical. Suspecting fraud, Prudentialife began an investigation into the
matter, and on February 22, 2006, it sent individual written Notices to Explain5 to petitioners and
other employees who availed of the benefit. The notices revealed its initial findings – that the given
address and telephone number of Alavera Optical were fictitious; that the official receipts and
prescriptions issued by Alavera Optical appear to have been forged; that the eyeglasses were
grossly overpriced; and that Prudentialife was being required to pay for the eyeglasses even though
they have not been released as yet. The notices required the recipients thereof to submit their
written explanation relative to acts of dishonesty and fraud which they may have committed in
connivance with Alavera Optical.

Petitioners and the other availing employees submitted their respective written explanations.
Prudentialife brought the subject eyeglasses to reputable optical shops – particularly Sure Vision
and Sarabia Optical – for comparative examination as to quality and price. The eyeglasses of
Evangelista and Dolendo were brought to Sure Vision Optical, Star Mall branch, Mandaluyong City,
and Sy’s were brought to Sarabia Optical, Greenbelt I branch, Makati City. The two optical shops
found that Dolendo and Sy’s eyeglasses had no grade, while the grade on Evangelista’s eyeglasses
did not match the prescription issued to her. It was likewise discovered that the cost of petitioners’
eyeglasses, as declared in their respective official receipts and reimbursement requests, was
excessive compared to similar frames and lenses being sold by SureVision and Sarabia Optical.6

In her written explanation, Castillo claimed that she acted in good faith in availing of the optical
benefit allowance; that she did not conspire with Alavera Optical in the overpricing of her
eyeglasses; that she was made to believe that her transaction with Alavera Optical – whereby the
latter would issue an official receipt for the eyeglasses even without actual payment thereof, which
Castillo would then claim from Prudentialife – was regular; that she was unaware that Alavera
Optical was using a fictitious address and telephone number; and that she had no intention to
defraud Prudentialife.7

Evangelista wrote that on January 27, 2006, a certain Dr. Simeona Alavera of Alavera Optical
offered to prepare her eyeglasses which she could pay later, or after the release of her optical
benefit allowance to which she agreed; that on January 30, 2006, her eyeglasses, together with the
prescription and official receipt, were delivered to her, and she submitted the same to Prudentialife
to claim reimbursement; that on February 1, 2006, she obtained a P2,500.00 reimbursement for her
eyeglasses, which she used to pay Dr. Simeona Alavera; and that she acted in good faith and
pursuant to company policy.8

For her part, Dolendo stated that she met Dr. Simeona Alavera through her colleague at work; that
she heard that the doctor was conducting eye examinations at the third floor of their building, thus
she had her eyes examined as well; that on January 30, 2006, she received the official receipt for
her eyeglasses in the amount of P2,500.00 and the doctor’s prescription therefor, which she
forwarded to Prudentialife; and that she had no knowledge of any dishonesty or overpricing of the
eyeglasses relative to the optical benefit allowance.9
Petitioner Sy explained that Dr. Simeona Alavera arrived at the Prudentialife office on January 27,
2006, complete with eye examination equipment and charts; that she subjected herself to
examination; that thereafter, Dr. Simeona Alavera offered to give her the official receipt and
prescription for eyeglasses even before actual payment thereof; that she did not bother to
investigate the authenticity, qualifications or integrity of Dr. Simeona Alavera or Alavera Optical, but
was confident of her diagnosis; that she was not aware of the market value of the eyeglasses but
was satisfied of the price at which she bought them; and that she believed that the refraction grade
of her eyeglasses was the same as that written on the prescription issued by Alavera Optical.10

Other Prudentialife employees admitted that the eyeglasses they obtained cost only so much, yet
were overpriced for purposes of reimbursement. Thus, employees Roselle Marquez, Edgardo
Cayanan, Jennifer Garcia, Nerissa Rivera, Orlando Labicane, Michael Arceo, Jennifer Fronda and
Leopoldo Padlan acknowledged that the true cost of their respective eyeglasses ranged from only
P1,200.00 – P1,800.00, and yet Alavera Optical issued official receipts for a greater amount ranging
from P2,500.00 – P2,600.00 with their full knowledge and consent, which latter amounts were
actually reimbursed to them by Prudentialife even before the eyeglasses were released or paid for;
that the fraudulent scheme was spearheaded by a certain "Elvie of Head Office"; and that Elvie and
Dr. Simeona Alavera told them that the scheme was being carried out in other departments/offices
within Prudentialife.11

Prudentialife discovered that the employees who availed of the optical benefit allowance obtained
their eyeglasses from Alavera Optical, based on the employees’ reimbursement requests/petty cash
vouchers and the official receipts12 that the prescriptions13 for the eyeglasses were issued by a certain
Dr. Alan Alavera, yet the address, telephone number and Tax Identification Number of Alavera
Optical were fictitious; that it was Prudentialife employee Elvie Villaviaje who arranged with Alavera
Optical for the conduct of eye examinations within company premises; that to entice the employees,
Alavera Optical offered to release the eyeglasses and issue the prescriptions and official receipts
even before actual payment is made; and that the reimbursements sought for the eyeglasses were
more or less the same, or averaged at P2,500.00, yet they cost much less. Likewise, Prudentialife
found that some of the eyeglass purchases were fictitious; that some of the eyeglasses purchased
had no lens or grade; and that Alavera Optical issued prescriptions, released the eyeglasses, and
issued the official receipts there for even though they have not been paid for.

Thus, Prudentialife concluded that petitioners and other employees knowingly availed of the optical
benefit allowance to obtain a refund of the maximum P2,500.00 benefit even though they did not
have vision problems, or that their eyeglasses were worth less thanP2,500.00.

On April 10, 2006, Prudentialife issued individual Notices of Termination14 to petitioners and other
employees. The notices, signed by respondent Patiño, stated in part that–

In sum, we find that your explanation consisted mainly of bare denials and professions of innocence.
We regret to inform you that we find your explanation to be not acceptable on the following grounds:

1. Based on the statements made by the other employees involved in this case, our
investigation reveals that you are aware of the scheme by which the attending optometrist,
Mrs. Simeona Alavera, would issue to you an Official Receipt for an amount grossly in
excess of the real cost of your eyeglasses to enable you to collect the excess amount for
your personal use.

2. You and the other employees were examined by Mrs. Alavera in the presence of one
another and you were apprised of the scheme during the examination/checkup.
 3. During the investigation, we confirmed that there was never any actual delivery of the
eyeglasses to you, yet you submitted a reimbursement request. You therefore submitted an
O.R. for an item which you have not actually received.

4. Your failure and refusal to divulge the whole truth shows your lack of any effort to come
clean and help in the investigation of the case. In fact, it displays an attempt on your part to
mislead the investigation and further confirms our findings of your dishonesty.

After careful and thorough evaluation, we find you culpable of DISHONESTY which, under Section
2.6 (i) of the Personnel Manual is punishable by Dismissal, to wit:

2.6 DISHONESTY

The disciplinary actions for offenses on Dishonesty shall be the following but not limited to:

xxxx

(i) Padding receipt for reimbursement or liquidation of advances or expenses

1st Offense–Dismissal

Hence, you are terminated effective immediately upon receipt hereof and your separation benefits
under the Company’s Optional Retirement Program are hereby forfeited.

Furthermore, please be informed that your termination is without prejudice to whatever legal action
which the Company may pursue to protect its interests.15

Ruling of the Labor Arbiter

On May 5, 2006, petitioners filed a Complaint for illegal dismissal, money claims and damages
(illegal dismissal case) against respondents, docketed as NLRC-NCR Case No. 00-05-03815-
06.16 Another case was filed for unfair labor practice, docketed as NLRC-NCR Case No. 00-07-
05882-06, which was later on consolidated with the illegal dismissal case.

In their Position Paper,17 petitioners mainly contended that they were illegally dismissed based on a
charge of dishonesty that was not proved, but was mainly founded on suspicion, conjecture and
suppositions. They claimed that they did not commit any padding of the cost of the eyeglasses they
bought from Alavera Optical; nor did they commit any act detrimental to Prudentialife’s interests.
They argued that quite the contrary, their transactions with Alavera Optical were valid and done in
the ordinary course of business; that their right to due process was violated as they were not given
ample time and opportunity to defend themselves; that they were deprived of their right to counsel;
and that their bargaining agent PPEU-FFW was not informed of the case against them. For these
reasons, petitioners argued that they should be awarded their money claims and damages.

In their Position Paper18 seeking dismissal of the Complaint, respondents cited Prudentialife’s
emphasis on promoting integrity and honesty among its ranks, which policy is embodied in its
Personnel Manual, the pertinent provision of which was precisely utilized in indicting petitioners.
They insisted that petitioners were dishonest in knowingly claiming reimbursement for overpriced or
padded eyeglasses, in falsifying the official receipts and other documents relative to the optical
benefit allowance, and in obtaining reimbursement for eyeglasses which they did not pay for or
receive. They charged that petitioners’ bare denials are drowned by overwhelming evidence
gathered – which include confessions by other employees – proving their knowledge, complicity, and
participation in the fraudulent scheme. Respondents pointed out that when the fraudulent scheme
was carried out on January 27, 2006, petitioners – except for Castillo – were all present in one room
where the eye examinations were conducted, together with the employees who confessed to the
scheme; they were all issued official receipts on the same day, and claimed reimbursement at the
same time on January 30, 2006. Respondents added that Alavera Optical applied the same modus
operandi to all the employees it dealt with in regard to the optical benefit program; that petitioners
could not have been excepted, and that their eyeglasses were similarly priced and within the range
of the eyeglasses of those who confessed to the scheme; and that having committed falsification of
company documents, petitioners were guilty of serious misconduct and dishonesty, which merit
dismissal and denial of respondents’ monetary claims and prayer for an award of damages.

On the issue of due process, respondents argued that the twin notice requirements were satisfied:
the notices to explain apprised the recipients thereof of their supposed acts and the rule violated, as
well as the penalty prescribed for such violations. Moreover, notices of termination were duly sent to
petitioners. All in all, petitioners were afforded due process and given the opportunity to defend
themselves. Finally, respondents took exception to the inclusion of Prudentialife officers as
respondents to the Complaint, claiming that their acts were done pursuant to their duties and in
furtherance of the corporate objective, which should thus exempt them from personal liability.

On April 30, 2007, Labor Arbiter Fe S. Cellan issued a Decision19 in the illegal dismissal case,
decreeing as follows:

WHEREFORE, in view of the foregoing, the instant consolidated complaints are hereby DISMISSED
for lack of merit.

SO ORDERED.20

The Labor Arbiter held that there was ground to dismiss petitioners, finding that there was a
concerted and premeditated scheme to defraud Prudentialife, using the optical benefit provision in
the CBA to enrich the availing employees by declaring overpriced eyeglasses, obtaining
reimbursement therefor, and pocketing the difference between the amount reimbursed and the
actual cost or selling price of the spectacles. This constituted dishonesty.

The Labor Arbiter added that respondents took pains to investigate and substantiate the charges
against the guilty employees, submitting the subject eyeglasses to other optical shops for
examination and comparison instead of merely relying upon the written explanations of the
employees and the admissions obtained fromsomeofthem. Having established breach of trust
through a scheme perpetrated to defraud Prudentialife, the Labor Arbiter held that the company
possessed the right to dismiss the guilty employees as a measure of self-protection.

The Labor Arbiter held further that the dismissal of an estafa charge21 against the guilty employees
does not necessarily result in a finding of illegal dismissal. Conversely, the filing of a subsequently
dismissed estafa charge cannot constitute unfair labor practice, as this is a right granted to
Prudentialife as a party injured by the fraudulent scheme; the filing of criminal charges could not
have the effect of preventing petitioners from filing the illegal dismissal case, nor were the latter
cowed into fear as a result of the filing of the charges.

The Labor Arbiter found baseless petitioners’ monetary claims, prayer for damages, and their effort
to hold the individual respondents liable, stating that petitioners have not substantiated these claims
and it has not been shown that the individual respondents exceeded their authority in the
performance of their functions,orthattheyacted inbad faith.
 Ruling of the National Labor Relations Commission

Respondents filed an appeal with the NLRC. In a December 8, 2008 Decision,22 the NLRC reversed
the Labor Arbiter, decreeing thus:

CONFORMABLY WITH ALL THE FOREGOING, the present appeal ispartly Granted in that
complainants-appellants were illegally dismissed and hence, should be reinstated and be paid their
full backwages from the time they were illegally dismissed up to the finalityofthisdecision.

All other claims of complainants-appellants are dismissed for lack ofmerit.

SO ORDERED.23

In sum, the NLRC held that petitioners’ liability has not been substantiated, it not having been shown
that petitioners were privy to the fraudulent scheme. The NLRC believed that the admissions of the
other employees do not prove petitioners’ complicity and participation in the scheme. It declared that
respondents failed to submit independent evidence to show the petitioners’ guilt, and that petitioners
were not given the opportunity to meet and cross-examine respondents’ witnesses – or those
employees who submitted written explanations admitting the presence of an illegal scheme to profit
by the optical benefit provision in the CBA, namely Roselle Marquez, Edgardo Cayanan, Jennifer
Garcia, Nerissa Rivera, Orlando Labicane, Michael Arceo, Jennifer Fronda and Leopoldo Padlan;
thus, their statements are in admissible.

Nonetheless, the NLRC declared that there was no denial of procedural due process, since
petitioners were afforded the opportunity to meet the charges against them and respondents were
not remiss in their duty to accord them this right during the process. Regarding the charge of unfair
labor practice, the NLRC was convinced that respondents are not guilty of undue discrimination in
initiating criminal charges against petitioners for their perceived violation of the Revised Penal Code.

Respondents moved for reconsideration, but in an August 8, 2009 Resolution,24 the NLRC stood its
ground.

Ruling of the Court of Appeals

Respondents went up to the CA via an original Petition for Certiorari,25 insisting that there was just
cause to dismiss the petitioners for serious misconduct. OnJanuary14,2011, the CA issued the
assailed Decision, decreeing as follows:

WHEREFORE, the foregoing considered, the petition is GRANTED.

The assailed Decision dated 08 December 2008 of public respondent NLRC as well as its assailed
Resolution dated 28 August 2009 are REVERSED and SET ASIDE, and the Decision dated 30 April
2007 of Labor Arbiter Fe S. Cellan is hereby REINSTATED.

SO ORDERED.26

In reversing the NLRC, the CA found that there was indeed cause to dismiss petitioners, the
evidence indicating that petitioners and the other employees knew, assented and took part in the
scheme to profit by pocketing the difference between the declared cost and actual cost of the
eyeglasses; that based on the written statements of the other participants to the scheme, petitioners
are guilty of serious misconduct, dishonesty, fraud and breach of trust, which rendered them unfit to
continue working for Prudentialife. The appellate court cited particularly the fact that the eyeglasses
purchased by petitioners from Alavera Opticaldidnothaveanygrade.

The CA added that since the instant case is a labor case, only substantial evidence – and not guilt
beyond reasonable doubt – is required in establishing petitioners’ liability; that due process was
observed by respondents, as petitioners were furnished with the requisite twin notices before their
services were terminated; and that petitioners were afforded the opportunity to be heard on their
defense through their respective written explanations, and no hearing was required before a decision
on their case could be properly arrived at.

Petitioners moved to reconsider, reiterating that the CA based its Decision on conjecture; that the
evidence against them was not substantial; and that due process was not observed. In a March 16,
2011 Resolution,27 however, the CA stood its ground. Thus, the instant Petition.

Issues

Petitioners submit the following assignment of errors:

THE COURT OF APPEALS SERIOUSLY ERRED AND COMMITTED GRAVE ABUSE OF

DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION WHEN IT RENDERED
ITS DECISION NOT IN ACCORD WITH LAW AND JURISPRUDENCE AS ALREADY
DETERMINEDBYTHISHONORABLECOURT;

II

THE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO

LACK OR IN EXCESS OF JURISDICTION WHEN IT REVERSED THE DECISION RENDERED BY
THE NATIONAL LABOR RELATIONS COMMISSION WHICH DETERMINEDTHAT:

1.While the affidavits offered in evidence by respondents-appellees indeed recounted how

the fraudulent scheme is being undertaken by Alavera Optical and some employees who
availed of their services, it cannot however, escape our attention the fact that there is nothing
in the said affidavits that categorically implicate complainants-appellants to the subject
transactions;

2.Let it be emphasized that in labor cases, substantial evidence is required to establish one’s
case. By substantial evidence, it means such relevant evidence which a reasonable mind
might accept to support a conclusion. x x x this Commission would not be amiss to state that
time and again it held that unsubstantiated accusation no matter how sincerely felt is nothing
but hearsay that deserves no probative value;

3.Be it noted that in the cases of Aniceto W. Naguit Jr. v. NLRC, 408 SCRA 617 and the
case of Mario Hornales v. NLRC, 364 SCRA 778, it has been settled that for an affidavit to
be given evidentiary weight, the affiants must testify on [their]statements therein to attest
[to]the veracity of [their] testimony and; the opposing party must be given the opportunity to
meet and cross-examine the affiants in order for them to test the truthfulness of their
statements. x x x it is palpably clear complainants-appellants were not afforded by
respondents-appellees the opportunity to meet the affiants and to cross-examine them.
Likewise, neither were these affiants testified [sic] on the veracity of their statements either
 during the administrative investigation conducted by therespondents-
appelleesnorbeforetheLaborArbiter.xxx28

Petitioners’ Arguments

In their Petition and Reply,29 petitioners urge a judicious review of the case given the conflicting
decisions of the labor tribunals and the appellate court. They add that it was improper for the CA to
adjudge them guilty of wrongdoing based on the written admissions of their co-employees and not
on evidence pointing to their wrongdoing, and it is unfair for the CA to sweepingly rule that the acts
of some employees were attributable to all who availed of the optical benefit allowance.

Petitioners further cite that while Prudentialife supposedly found that the eyeglasses they purchased
had no grade, they were not afforded the opportunity to meet and contest this finding; that this
finding was not included in the written notice to explain which they received, and thus could not be a
valid basis for their dismissal since they were unable to explain their side on such issue. Petitioners
reiterate the NLRC findings that the other employees who admitted to the illegal scheme did not
implicate them, nor can these employees’ statements be used to show petitioners’ guilt or privity to
the illegal scheme since these written statements are inadmissible in evidence as they were not
given the opportunity to contest them, nor were they allowed to cross-examine the employees who
prepared and submitted them; that in Garcia v. Malayan Insurance Co., Inc.,30 it was held that the
statement of a co-employee may not be used to prove the guilt of an employee accused of theft of
company property; and that there can be no other conclusion than that their dismissal was based on
mere conjecture and suspicion, and for this reason, the burden of proof – which falls on Prudentialife
– has not been properly discharged.

Additionally, petitioners claim that they did not unduly profit from availing of the optical benefit
provision under the CBA, since they did not claim or receive anything other than the eyeglasses; that
no evidence was shown to support respondents’ claim that their eyeglasses were overpriced, and
any variation in prices of eyeglasses between the various optical shops merely shows that free
market forces were in operation – not that the particular eyeglasses they obtained from Alavera
Optical were overpriced; and that their categorical denial was sufficient to negate any accusation or
suspicion of involvement in the scheme or conspiracy surrounding the optical benefit provision in the
CBA. 1âwphi1

Petitioners thus pray for the reversal of the assailed dispositions and the reinstatement of the
December 8, 2008 NLRC Decision. In addition, they seek an award of damages and attorney’s fees.

Respondents’ Arguments

In their Comment,31 respondents pray for the denial of the Petition, arguing against a departure from
the CA pronouncement and insisting that the appellate court’s disposition of the issues was sound
and based on substantial evidence. They contest the NLRC Decision, claiming that it is gravely
erroneous and based on a misapprehension of the facts. They insist on the validity of petitioners’
dismissal, which according to them was based on adequate documentary evidence; and that the fact
that not all who were involved in the illegal scheme were dismissed does not affect the liability of
petitioners. Besides, some of them resigned or left Prudentialife right after the incident occurred
while others have shown that their availment of the optical benefit was genuine. They hold that the
petitioners’ dismissal was based on substantial evidence gathered in an investigation duly
conducted, and on the findings of reputable optical shops which made an examination and
comparison of the petitioners’ eyeglasses; that overall, petitioners are guilty of dishonesty; that they
did not violate petitioners’ right to due process; and finally, that petitioners are not entitled to their
money claims, damages, and attorney’s fees given that their dismissal was for cause and no bad
faith attended the same.

Our Ruling

The Court affirms.

When there is a divergence between the findings of facts of the labor tribunals and the CA, there is a
need to refer to the record. "It is an established rule that the jurisdiction of the Supreme Court in
cases brought before it from the CA via Rule 45 of the 1997 Rules of Civil Procedure is generally
limited to reviewing errors of law. This Court is not a trier of facts. In the exercise of its power of
review, the findings of fact of the CA are conclusive and binding and consequently, it is not our
function to analyze or weigh evidence all over again. There are, however, recognized exceptions to
this rule such as when there is a divergence between the findings of facts of the NLRC and that of
the CA."32

The evidence on record suggests that, with the aim in view of availing the optical benefit provision
under the CBA, Prudentialife employee Elvie Villaviaje initiated acompany-wides cheme with Alavera
Optical where by the latter, through its optometrists, conducted eye examinations within company
premises and issued prescriptions on January 27, 2006, and subsequently prepared and released
eyeglasses to the participating Prudentialife employees. In turn, these employees claimed
reimbursement for the cost of their eyeglasses through the optical benefit provision, to the allowable
extent of P2,500.00. The evidence shows that even before they could pay for the cost of their
eyeglasses, Alavera Optical offered to issue, as it did issue, official receipts in advance to the
availing employees, which they used to secure reimbursements from Prudentialife ahead of the
actual payment of the eyeglasses; the petitioners acknowledged this fact in their individual and
respective written explanations. Likewise, some of the availing employees33 – except petitioners –
admitted that they knew that the true cost of their respective eyeglasses ranged from only P1,200.00
– P1,800.00; that Alavera Optical deliberately issued official receipts for a greater amount ranging
from P2,500.00 – P2,600.00 with their full knowledge and consent; that they used these official
receipts to claim reimbursement; and that Prudentialife actually
reimbursedthemtotheextentofP2,500.00.

It as well appears that after some of the subject eyeglasses were submitted to other optical shops for
inspection, comparison and examination, it turned out that these did not have any grade, or that the
grade did not match the prescription issued for the eyeglasses. Specifically, Dolendo and Sy’s
eyeglasses had no grade, while the grade on Evangelista’s eyeglasses did not match the
prescription issued to her. It was likewise found that the cost of the eyeglasses – including
petitioners’, as declared in the respective official receipts and reimbursement requests covering
them, was excessive compared to similar frames and lenses beings old or offered by other optical
shops.

For its part, Alavera Optical submitted a fictitious address, telephone number and Tax Identification
Number, using these in the written prescriptions it issued. And to entice Prudentialife employees into
participating in the scheme, Alavera Optical offered to release the eyeglasses and issue the
prescriptions and official receipts even before actual payment therefor is made – which meant that
participating employees need not pay for the cost of their eyeglasses from their own pockets, but
could use the documents to obtain immediate reimbursement fromPrudentialife.

It likewise appears that based on the reimbursement requests/petty cash vouchers and official
receipts, the cost of the eyeglasses is more or less the same, or at an average of P2,500.00, which
coincidentally is the maximum reimbursable amount under the optical benefit provision in the CBA.
From the above, it appears that there was a conspiracy to defraud Prudentialife using the optical
benefit provision in the CBA to unduly enrich the availing employee, and possibly Alavera Optical,
through overpricing of the latter’s eyeglasses and appropriation of the difference between the
bloated price and the actual cost. Employees who participated in the scheme knew, as they were
informed by the proponents of the scheme – namely Elvie Villaviaje and Alavera Optical, of the fact
that if they participated and underwent eye examination through Alavera Optical, they would be
issued a prescription and official receipt indicating that they paid up to P2,600.00 for the frames and
lenses that were prescribed, which documents they could then use to obtain reimbursements of up
to P2,500.00 from Prudentialife – even if they did not actually pay for them, and though the cost of
the eyeglasses was less than P2,500.00. Any employee who, knowing of the scheme, yet
participates therein, becomes a co-conspirator to the fraud.It is elementary that "when there is a
conspiracy, the act of one is the act of all the conspirators, and a conspirator may be held as a
principal even if he did not participate in the actual commission of every act constituting the offense.
In conspiracy, all those who in one way or another helped and cooperated in the consummation of
the crime are considered co-principals since the degree or character of the individual participation of
each conspirator in the commission of the crime becomes immaterial."34 In proving complicity, direct
evidence is not necessary, as it can be clearly deduced from the acts of the conspirators;35 it may be
proved through a series of acts done in pursuance of a common unlawful purpose.36

Conspiracy exists when two or more persons come to an agreement concerning the commission of a
felony and decide to commitit. Conspiracy need not be proved by direct evidence and may be
inferred from the conduct of the accused before, during and after the commission of the crime, which
are indicative of a joint purpose, concerted action and concurrence of sentiments. In conspiracy, the
act of one is the act of all. Conspiracy is present when one concurs with the criminal design of
another, indicated by the performance of an overt act leading to the crime committed. It may be
deduced from the mode and manner in which the offense was perpetrated.37

From the evidence on record, it has been sufficiently shown that petitioners actually took part in the
commission of the acts complained of, which makes them co-conspirators to the scheme. For sure, it
cannot be said that they are exceptions to the rule simply because they categorically denied
participation, or that there is no direct evidence of their complicity. Quite the contrary, there is
evidence pointing to their participation in the fraudulent scheme. First of all, they all knew that even
though they were not paying for the eyeglasses, Alavera Optical would issue, as it did issue, an
official receipt falsely showing that the eyeglasses have beenpaidfor,which they would
thenuse,astheydiduse,toobtain reimbursement from Prudentialife. By presenting the false receipt to
their employer to obtain reimbursement for an expense which they did not in fact incur, this
constituted dishonesty.

Secondly, it was discovered that Dolendo’s and Sy’s eyeglasses had no grade, while Evangelista’s
eyeglass lens did not match the prescription issued to her. An eyeglass without graded lenses could
1âw phi1

only indicate that the wearer thereof has no vision problems, which does away with the necessity of
availing of the optical benefit provision under the CBA which is understandably reserved for those
employees who have developed vision problems in the course of employment. By availing of the
benefit, the employee represents to Prudentialife that he has developed vision problems. If this is not
true, then he has committed an act of dishonesty as well. Given the circumstances then obtaining,
the same principle holds true with respect to eyeglasses whose lenses do not match the
corresponding prescription.

For their dishonesty, the penalty of dismissal is justified pursuant to Section 2.6 (i) of the
Prudentialife Personnel Manual which prescribes the penalty of dismissal for acts of padding
receipts for reimbursement or liquidation of advances or expenses. Dishonesty is a serious offense,
and "no employer will take to its bosom a dishonest employee."38 Dishonesty implies a "[d]isposition
to lie, cheat, deceive, or defraud; untrustworthiness; lack of integrity[; l]ack of honesty, probity or
integrity in principle; lack of fairness and straightforwardness; disposition to defraud, deceive or
betray."39 Acts of dishonesty have been held to be sufficient groundsfordismissalasameasureofself-
protectiononthepartoftheemployer.40

The written statements of petitioners’ co-employees admitting their participation in the scheme are
admissible to establish the plan or scheme to defraud Prudentialife; the latter had the right to rely on
them for such purpose. The argument that the said statements are hearsay because the authors
thereof were not presented for cross-examination does not persuade; the rules of evidence are not
strictly observed in proceedings before the NLRC, which are summary in nature and decisions may
be made on the basis of position papers.41 Besides, these written declarations do not bear directly on
petitioners’ participation in the scheme;theirguilthasbeen establishedbyevidenceotherthan
thesestatements.

Petitioners’ reliance on Garcia v. Malayan Insurance Co., Inc.42 is misplaced. Far from declaring that
the statement of a co-employee may not be used to prove the guilt of an employee accused of theft
of company property, the Court held therein that the affidavit of the co-employee cannot serve as
basis for the finding that said petitioner conspired in the theft because it was so lacking in crucial
details. The opposite is thus true: the affidavit or statement of a co- employee in a labor case may
prove an employee’s guilt or wrongdoing if it recites crucial details of his involvement.

Furthermore, petitioners’ contention that they were not apprised of the fact that it has been
discovered that their eyeglasses had no grade comes as a surprise. The truth or falsity of this fact or
allegation is readily ascertainable by the petitioners themselves; the answer is literally right before
their very eyes. If their eyeglasses indeed had a grade, then they would have said so outright – and
not relegate the matter to a mere due process issue. They are presumed to wear these very
spectacles each and every day. Besides, as early as in the respondents’ Position Paper below, it
was raised as an issue that petitioners’ eyeglasses either had no grade or did not match the
prescription issued therefor; indeed, petitioners have been given sufficient opportunity to meet such
accusation in the Labor Arbiter stage.

Finally, petitioners’ argument and prayer for an award of damages and attorney’s fees may not be
allowed, since they did not question the NLRC’s denial thereof in its December 8, 2008 Decision.
Only respondents went up to the CA on certiorari. "It is well-settled that a party who does not appeal
from the decision may not obtain any affirmative relief from the appellate court other than what he
has obtained from the lower court whose decision is brought up on appeal. The exceptions to this
rule, such as where there are (1) errors affecting the lower court’s jurisdiction over the subject
matter, (2) plain errors not specified, and (3) clerical errors, do not apply in this case."43 "[A] party
who did not appeal cannot assign such errors as are designed to have the judgment modified. All
that he can do is to make a counter-assignment of errors or to argue on issues raised below only for
the purpose of sustaining the judgment in his favor."44

WHEREFORE, the Petition is DENIED. The January 14, 2011 Decision and March 16, 2011
Resolution of the Court of Appeals in CA-G.R. SP No. 111981 are AFFIRMED.

SO ORDERED.
 EN BANC

A.M. No. P-11-2979 November 18, 2014

[formerly OCA IPI No. 10-3352-P]

ELLA M. BARTOLOME, Complainant,

vs.
ROSALIE B. MARANAN, COURT STENOGRAPHER III, REGIONAL TRIAL COURT, BRANCH 20,
IMUS, CAVITE, Respondent.

DECISION

PER CURIAM:

This administrative matter started through the sworn affidavit complaint1 in the vernacular, dated
December 16, 2009, that Ella M. Bartolome (complainant) filed against Rosalie B. Maranan
[respondent, Court Stenographer III, Regional Trial Court (RTC), Branch 20, Imus, Cavite], charging
her with extortion, graft and corruption, gross misconduct and conduct unbecoming of a court
employee.

The complainant alleged that the respondent asked money from her in the amount of ₱200,000.00,
which was later reduced to ₱160,000.00, to facilitate the filing of her case for annulment of marriage.
She further alleged that the respondent undertook to have the case decided in her favor without the
need of court appearances during the proceedings of the case. For a clear and complete picture of
the accusations against the respondent, we quote verbatim the pertinent portions of the
complainant’s narration of the incidents that gave rise to the filing of the present administrative
complaint –

xxxx

2. Na noong October 21, 2009 nakilala ko si ROSALIE MARANAN na isang stenographer sa

Regional Trial Court ng Imus, Cavite. Nasabihan ko siya ng aking kagustuhan na magsampa ng
annulment of marriage case. Agad niya akong inalok at pinangakuan na kaya niyang ipasok ang
aking annulment case sa RTC, Br. 20, Imus, Cavite kung saan siya nagtratrabaho. Noong una ang
hinihingi niya sa akin ay halagang TWO HUNDRED THOUSAND PESOS (₱200,000.00) pero
humingi ako sakanya ng discount at pumayag siya sa ONE HUNDRED SIXTY THOUSAND PESOS
(₱160,000.00). Ako po ay naengganyo na magtiwala sa kanya dahil nangako siya na siya na ang
bahala sa lahat. May kausap na daw siyang abogado na pipirma sa petisyon koat di ko na daw
kailangan pang umappear sa korte. Sinabi niya na malakas daw siya sa judge at sa fiscal at siya
lang daw ang pinapayagan na magpasok ng mga aaregluhin na kaso sa kanilang korte. Sinabi niya
din na kasama na sa ₱160,000.00 ang para sa judge at sa fiscal kaya siguradong maaaprubahan
ang aking annulment case sa mabilis na panahon. Kasama po ng Affidavit Complaint na ito ang
transcript at ang SIM Carday aking ipadadala kapag ako ay makasigurado na ang Korte Suprema ay
poprotektahan ang mga ebidensya laban kay MARANAN sapagkat rito lahat nakatagon (sic) ang
mga text messages at nakarecord lahat ng calls nitong si ROSALIE MARANAN sa akin na
nagpapatunay ng panghihingi niya sa akin ng pera at pangako na aaregluhin niya ang aking
annulment of marriage case. Ang cellphone number po na nagaappear dito sa SIM ay kay
ROSALINA MARANAN, ang numero niya ay 09175775982. Maaaring nagpalit na ng numero ang
inirereklamo ko kung kaya’t maganda rin na ipag-utos ang pag-alam ng detalye mula sa Globe
Telecoms kung saan post-paid subscriber ang may-ari ng numero na iyan. [Emphasis supplied]
To put an end to the respondent’s extortion activities, the complainant decided to report the matter to
the police authorities. During the entrapment operation conducted by police officers of Imus Police
Station, the respondent was apprehended inside the premises of the RTC, Branch 20, Imus, Cavite,
in the act of receiving the money from the complainant.

In support of her allegations, the complainant attached to her affidavit-complaint the transcribed
electronic communications (text messages) between her and the respondent;2 a copy of an
Electronic Psychiatric History form given to her by the respondent for her to accomplish in filing the
petition for annulment of marriage;3 a copy of the Imus Police Station Blotter showing that the
respondent was apprehended during the entrapment operation conducted by police officers of Imus
Police Station on November 11, 2009 at 2:40 p.m.;4 and a versatile compact disc (VCD) containing
the video taken during the entrapment operation conducted against the respondent.5

The Court, in a 1st Indorsement6 dated March 19, 2010, required the respondent to comment onthe
complaint against her.

In her Comment dated May 27, 2010,7 the respondent denied the accusations against her. She
alleged her belief that Bartolome is a fictitious name as the affidavit-complaint does not indicate the
complainant’s exact address. She asserted that her detention at Imus Police Station does not prove
her culpability since no actual criminal charges were filed against her. She claimed that the lapse of
six (6) months from the time of the alleged incident indicates that the complaint is pure and simple
harassment orchestrated by a lawyer or litigant who has a grudge against her and who wants to
publiclybesmirch her reputation. In support of her defense, the respondent mentioned that even
Judge Fernando L. Felicen (Judge Felicen), Presiding Judge of RTC, Branch 20, Imus, Cavite
interceded for her release from detention.

On July 29, 2010, the complainant sent a letter to the Office of the Court Administrator
(OCA),8 without indicating her address, alleging that she has to constantly change residence
because unidentified persons had been seen in their neighborhood asking questions about her. She
has also been receiving text messages from the respondent telling her that her complaint would only
be dismissed because she knows people in the Supreme Court. The respondent also threatened
retaliation against her after the case is terminated. The complainant further claimed that the pieces
of evidence she submitted are sufficient to prove the respondent’s anomalous activities, and prayed
for the immediate resolution of her complaint.

Based on the complainant’s pleadings and evidence, the OCA, (through then Deputy Court
Administrator Nimfa C. Vilches and OCA Chief of Legal Office Wilhelmina D. Geronga) submitted its
Report to the Court dated May 9, 2011,9 finding enough evidence to prove the respondent’s
involvement in anomalous activities and recommending that –

1) OCA IPI No. 10-3352-P be RE-DOCKETED as a regular administrative matter;

2) respondent Rosalie B. Maranan, Court Stenographer III, Regional Trial Court, Branch20,
Imus, Cavite, be found GUILTY of Grave Misconduct and Conduct Prejudicial to the Best
Interest of the Service; and

3) respondent Maranan be immediately DISMISSED from the service with forfeiture of

retirement benefits except her accrued leave credits, and withperpetual disqualification from
employment in any government agencies or instrumentalities, including government owned
and controlled corporations.
In a Resolution dated September 5, 2011,10 the Court required the parties to manifest whether they
were willing to submit their case for resolution on the basis of the pleadingsfiled. The respondent
filed her Manifestation dated November 17, 201111 submitting the case for resolution by the Court.
She reiterated her complete innocence and "vigorous" and "vehement" denial ofthe allegations
against her. She insisted that the present complaint against her is plain and simple harassment and
a vexatious suit by the complainant who either has a grudge against her or must have been used by
another person with a grudge against her. All she did was tosecure the services of a lawyer at the
complainant’s request; this act, she claimed, does not constitute graft and corruption, gross
misconduct, conduct unbecoming of a court employee and extortion.

The complainant did not respond to our September 5, 2011 Resolution as it was returned unserved
on her. Wenevertheless considered the case submitted for resolution considering her letter of July
16, 2010 praying for the immediate resolution of her complaint.

In our Internal Resolution dated December 7, 2011,12 we resolved to refer the complaint to the OCA
for evaluation, report and recommendation.

The OCA responded through its Memorandum of July 16, 2012,13 finding that the pieces of evidence
on record establish the guilt of the respondent on the charges of Gross Misconduct and Conduct
Prejudicial to the Best Interest of the Service filed against her. It recommended that the respondent
be found guilty of the offenses charged and be dismissed from the service, with forfeiture of
retirement benefits except her accrued leave credits and with perpetual disqualification from
employment in any government agency.

The Court fully agrees with the OCA’s recommendation.

The respondent’s bare denial cannot overcome the evidence supporting the complainant’s
accusation that she demanded money on the promise that she would facilitate the annulment of her
(complainant’s) marriage. The respondent’s actions from the time the complainant started
communicating with her on October 21, 2009 and thereafter through a series of messages they
exchanged via SMS,14 until the entrapment operation on November 11, 2009, showed that the
complaint is indeed meritorious. The respondent’s text messages sent to the complainant
corroborate that she promised to expedite – in exchange for a monetary consideration of
₱160,000.00 and that she would provide the lawyer who would file the annulment case – the
complainant’s annulment case once it is filed:15

21/19/09 8:40pm

Sino po to

21/10/09 8:53pm

Sino nagrefer sayo sakin ano pangalan?

21/10/09 8:54pm

San mo nakuha # ko

21/10/09 9:05pm

Ako rin magbibigay lawyer sayo

21/10/09 9:13pm

D kaba tlaga makakatawag ngayon

21/10/09 9:18pm

Ako n lang tatawag sayo kc mahirap ang txt lang

21/10/09 9:24pm

Tawag n lng ako ha

21/10/09 9:49pm

Natitiwala ako sayo ha dahil hindi lahat pinagbibigyan namin. Sally n lang tawag mo sakin
nagtataka lng kc ako kanina kc buong buong buo yung txt ng name ko e.

21/10/09 9:51pm

Ay sorry mali pala sabi ko sayo 160k pala singil namin

22/10/09 10:05am

Gud am. Ano pwede k bukas

22/10/09 10:25am

ls txt bak naghihintay po kme

22/10/09 10:51am

Bukas lng available si atty

22/10/09 10:56am

Sana kung makakagawa ka daw paraan bukas kahit 40k n lng muna down tapos 3pm bukas

22/10/09 11:04am

Ok pero d kita pilipilit ha nasayopa din and decision yan ang sakin lng kc nagmamadali k at
tsaka yun ang free time ng lawyer ha

22/10/09 11:11am

Ella pakihusto mo n daw pala 50k at ibabayad daw mua sa psychiatrist at osg kahit sa
susunod n lng daw yung sa kanya

22/10/09 1:09pm
The complainant described the respondent as an influence peddler in the courts of Imus, Cavite who
acts as a conduit to judges, prosecutors and private law practitioners.

In her comment to the complaint,the respondent admitted that "she suggested to the complainant the
name of a lawyer friend, Atty. Renante C. Bihasa (Atty. Bihasa), and forwarded to her the cell phone
number of this lawyer so that theycould discuss the case." While she was in detention at Imus Police
Station, she called Atty. Bihasa, who told her that he was on his way and assured her that he had
already asked his lawyer friends to assist her. Atty. Bihasa arrived at about five o’clock in the
afternoon. As it was already beyond office hours, she was told by Atty. Bihasa of the possibility that
she would be detained pending investigation. Atty. Bihasa returned the following day and was joined
by Judge Felicen and her officemates. Judge Feliceninterceded in her behalf that she begiven
permission by the police officers to leave her detention in order to take a bath and change clothes.
She was granted permission, with the full guaranty of Judge Felicen that she would return.16

In an affidavit17 dated May 28, 2010, Atty. Bihasa corroborated the respondent’s allegations. In his
affidavit, he narrated that upon receiving a call from the respondent that she was being detained, he
immediately called up two (2) of his lawyer friends based at Imus, Atty. Wilfredo P. Saquilayan and
Atty. Jose Emmanuel Montoya, to assist the respondent. As he arrived at Imus Police Station at
around past four o’clock in the afternoon, he told the respondent of the probability of her detention
until formal charges were filed against her. According to him, "[he] took it upon [himself] to assist[the
respondent] on that date and accompanied her while the police officers of Imus PNP were doing
their routine work on suspects."

Atty. Bihasa further narrated thaton the next day at about five o’clock in the afternoon, he went
backto Imus Police Station to wait for the complainant. After a few hours, the respondent’s co-
workers, including Judge Felicen arrived. They waited for the complainant until seven o’clock in the
evening but she failed to come. Only the complainant’s lawyer arrived who informed the police
investigator that the complainant cannot come out of fear because of the death threats she
received.18

The concern that Atty. Bihasa and Judge Felicen showed to the respondent while under detention at
Imus PNP Station gives rise to the suspicion that they have knowledge and tolerate the respondent’s
anomalous activities. The respondent’s text messages to the complainant support this suspicion:19

At tsaka alam mo naman nakailang appointment n tayo sa abogado hiyang hiya nga ako
kahapon e

7/11/09 3:13pm

Tawagan ko muna si judge kung pwede pa kami tumanggap hanggang wed

7/11/09 3:15pm

Try ko lng

7/11/09 3:25pm

Hanggang Tuesday na lg tayo after nun nxt year na. Yan ang sabi

7/11/09 3:28pm
 Sayang kc ang haba n ng time mo dp natuloy sabi ko naman sayo e kapag inabot ng
naghigpit dn pwede none appearance. Yun nagan nagpatulong sakin kahapon lng tumawag
yun d sana nagka sabay n kayo

7/11/09 3:59pm

Ok po mit po tayo bukas 10 am sinabi ko napo kay atty. Tnx po. See you po

Ephemeral electronic communications are now admissible evidence, subject to certain conditions.
"Ephemeral electronic communication" refers to telephone conversations, text messages, chatroom
sessions, streaming audio, streaming video, and other electronic forms of communication the
evidence of which is not recorded or retained.20 It may be proven by the testimony of a person who
was a party to the communications or has personal knowledge thereof.21 In the present case, we
have no doubt regarding the probative value of the text messages as evidence in considering the
present case. The complainant, who was the recipient of the text messages and who therefore has
personal knowledge of these text messages, identified the respondent as the sender through
cellphone number 09175775982. The respondent herself admitted that her conversations with the
complainant had been thru SMS messaging and thatthe cellphone number reflected in the
complainant’s cellphone from which the text messages originated was hers. She confirmed that it
was her cellphone number during the entrapment operation the Imus Cavite Police conducted22

Sally:

Halika dito sa office, sa clerk of court. Pupunta ka ngayon? O sige, sige, pupunta ka ngaun?
Ah sige OK, salamat! Ang number ko …

Lalaki:

Ibigay ko sa kanya?

Sally:

Oo, ang number ko ay 09175775982, ok thank you.

The complainant submitted two (2) copies of the VCD23 containing pictures taken during the
entrapment conducted by the Imus Cavite Police on November 11, 2009.24

Under Section 1, Rule 11 of A.M. No. 01-7-01-SC, audio, photographic and video evidence of
events, acts or transactions shall be admissible provided it shall be shown, presented or displayed to
the court and shall be identified, explained or authenticated by the person who made the recording
or by some other person competent to testify on the accuracy thereof.

We viewed the VCD and the video showed the actual entrapment operation. The complainant
herself certified that the video and text messages are evidence of her complaint against the
respondent, "Sapat at malinaw ang lahat ng ebidensya na kasama ng aking reklamo na
nagpapatunay na totoo lahat ang nakasaad sa aking reklamo. Kitang kita sa video at sa mga text
messages niya ang kanyang modus operandi at paggamit niya ng pwesto sa gobyerno upang
makapanghingi ng malaking pera sa mga inosenteng tao." It is also well to remember that in
administrative cases, technical rules of procedure and evidence are not strictly applied.25 A.M. No.
01-7-01-SC specifically provides that these rules shall be liberally construed to assist the parties in
obtaining a just, expeditious and inexpensive determination of cases.
The Court totally agrees with the OCA’s finding that the respondent is guilty of grave misconduct and
conduct prejudicial to the best interest of the service. The respondent’s assertion that Bartolome is a
fictitious name because the complainant has not stated in her complaint her exact address is
preposterous in light of the evidence of direct personal and text message contacts between them. In
the absence of supporting evidence, the claim that the complaint against her is pure and simple
harassment orchestrated by persons with grudge against her, is mere conjectural allegation.

As a public servant, nothing less than the highest sense of honesty and integrity is expected of the
respondent at all times.26 She should be the personification of the principle that public office is a
public trust.27 The respondent unfortunately fell extremely short of the standards that should have
governed her life as a public servant. By soliciting money from the complainant, she committed a
crimeand an act of serious impropriety that tarnished the honor and dignity of the judiciary and
deeply affected the people’s confidence in it. She committed an ultimate betrayal of the duty to
uphold the dignity and authority of the judiciary by peddling influence to litigants, thereby creating the
impression that decision can be bought and sold.28 The Court has never wavered in its vigilance in
eradicating the socalled "bad-eggs" in the judiciary.29 We have been resolute in our drive to discipline
and, if warranted, to remove from the service errant magistrates, employees and even Justices of
higher collegiate appellate courts for any infraction that gives the Judiciary a bad name. To stress
our earnestness in this pursuit, we have, in fact, been unflinching in imposing discipline on errant
personnel or in purging the ranks of those undeserving to remain in the service.30

WHEREFORE, the Court finds respondent Rosalie B. Maranan, Court Stenographer Ill, Regional
Trial Court, Branch 20, Imus, Cavite, GUILTY of Grave Misconduct and Conduct Prejudicial to the
Best Interest of the Service and is accordingly DISMISSED from the service, with prejudice to re-
employment in any government agency including government-owned or controlled corporations. Her
retirement benefits, except accrued leave credits are ordered forfeited. This decision shall be
1âwphi1

immediately executory.

The Court further Resolves to REQUIRE Judge Fernando L. Felicen, Regional Trial Court, Branch
20, Imus, Cavite and Atty. Renante C. Bihasa, to file their Comments on their alleged participation in
the anomalous activities of the respondent, within fifteen ( 15) days from notice. This directive is
without prejudice to the investigation of all or selected employees and officials of the Branch, who
may have participated in anomalous transactions relating to annulment of marriage.

The Office of the Court Administrator is hereby directed to submit to this Court, within thirty (30)
days, a list of the annulment of marriage decisions of Judge Fernando L. Felicen for the past ten (10)
years, indicating therein the judgments made and the names of participating lawyers and
prosecutors.

The Office of the Chief Attorney shall analyze the submitted data, including the records of and the
proceedings in the listed cases, and recommend to the Court the actions it should take in the event a
pattern of corruption involving annulment of marriage cases emerges. The Office of the Chief
Attorney is given ninety (90) days from receipt of the Office of the Court Administrator's list, within
which to submit its recommendations to the Court.

The Office of the Court Administrator shall likewise refer this administrative case and its records to
the Ombudsman for whatever action it may take within its jurisdiction.

SO ORDERED.